Instruments in action
Settled ownership. Paper an institution can hold.
Four illustrative structures, built step by step: who owns the outcome, who pays, what investors hold and what evidence releases the money. They show Climate Securities designs and concepts.
- 01Sovereign noteHow can a nation finance its transition and keep title to it?
- 02Stewardship unitsHow can protection be paid for year by year, without new public debt?
- 03Blended programme fundWho takes which risk, and how does finance reach the last mile?
- 04State programme platformHow does a state move from single projects to a programme it governs?
Then: how a structure reaches the market, and the six instruments side by side.
Start with who owns it
Carbon, biodiversity, soil, water and blue carbon are natural capital. Every structure on this page starts from the land or sea, and from the nation or community that looks after it.
The flag marks title. It stays with the steward in every structure that follows.
Settle five things before anything is financed
Who holds legal title to each outcome. Where the registry and the right to issue sit. Who owns the baseline, the model and the data. How the community's share is written into contracts. On whose terms the outcomes reach the market.
Design the loop so value returns
The ecosystem is measured, the outcome is registered and owned, finance is raised against it, and value goes back to the people who look after it. Then the loop starts again with the next season's evidence.
Ownership without finance is a stranded asset. Finance without ownership is extraction. Each structure here is designed for both.
How to read the figures
One visual language, used in every structure
- TitleStays with the nation or community in every structure.
- MoneyProceeds, payments, coupons and repayments, and the way they travel.
- EvidenceMeasured, checked and recorded by parties independent of issuer and investors.
- Ring-fenced issuerHolds one programme's contracts and notes, apart from everything else.
- Outcome unitsVerified outcomes, serialised in a registry and delivered or kept.
- ShortfallA loss or a gap in delivery, and where in the structure it lands.
Every figure, structure and label on this page is illustrative.
Chapter 01 · Sovereign note
01 / Sovereign note
How can a nation finance its transition and keep title to it?
Illustrative design · Transition Sovereign Note
A government wants to fund a national transition programme through one instrument on its own credit, and to be rewarded for delivering it. The design ties the debt to verified delivery, so the outcome and the registry stay at home.
A national programme, owned at home
The sovereign sets a transition programme for nature, adaptation and industry. It keeps title to the outcomes and control of the national registry.
Nothing in the structure moves the asset off the nation's balance sheet.
One note, on sovereign credit
The sovereign, or a vehicle with a sovereign undertaking, issues one English-law note. Investors pay in and the proceeds fund the programme.
Investors hold a priced claim on the note. They hold no claim on the natural capital.
Two legs: a coupon, and delivery
The debt leg pays a coupon from budget lines or refinanced debt service. The delivery leg follows the plan: delivery is measured, checked by an accredited verifier and serialised as outcome units in the national registry.
Verified delivery steps the coupon. The units go to outcome buyers under Article 6.2 of the Paris Agreement, or the sovereign keeps them for its own targets.
Optional layers
A development-bank guarantee can strengthen the credit, and philanthropic first loss can absorb early delivery risk. Where existing debt trades at a discount, part of the saving from refinancing it can fund the programme, as debt-for-nature conversions have shown.
Authorisation, corresponding adjustments and national accounting stay with the competent authorities.
Chapter 01 · At a glance
Transition Sovereign Note
- Issuer
- The sovereign, or a vehicle with a sovereign undertaking
- Repaid from
- Budget lines or refinanced debt service; verified delivery steps the coupon
- Credit support
- Development-bank guarantee · philanthropic first loss, both optional
- Investors hold
- A priced claim on the note, never the natural capital
- Stays at home
- Title, the registry, authorisation and national accounting
- Evidence
- National measurement, reporting and verification · registry serialisation · Article 6.2 where used
- Status
- A Climate Securities design · none issued yet
Chapter 02 · Stewardship units
02 / Stewardship units
How can protection be paid for year by year, without new public debt?
Illustrative design · stewardship-unit bond
Units of protection
A protected area is divided into units: one square kilometre under verified protection, for one year.
The community keeps the area, its knowledge and the data.
Payers contract for the units
Companies and philanthropic funders that value the protection sign multi-year take-or-pay contracts for units.
Payments fall due on fixed dates, whether or not a payer takes delivery that year.
Contracts become notes
The receivables from those contracts are assigned to a ring-fenced issuer, which issues notes. Investors' money funds protection up front, without sovereign debt, and the notes are repaid from the contracted payments.
Investors hold a claim on contracted payments and nothing else.
A shortfall is visible, and contained
An accredited verifier checks protection unit by unit each year, and the registry records what was delivered.
A verified shortfall adjusts the units delivered later. It does not touch the receivable the notes rely on.
Chapter 02 · At a glance
Stewardship-unit bond
- Issuer
- A ring-fenced issuer
- Repaid from
- Take-or-pay contracts for stewardship units, with the receivables assigned to the issuer
- Credit support
- Reserve account · first loss · development-bank anchor
- Investors hold
- A claim on contracted payments
- Stays with the community
- The area, its knowledge and the data
- Evidence
- Protection verified per square kilometre per year
- Status
- A Climate Securities design · illustrative
Chapter 03 · Blended programme fund
03 / Blended programme fund
Who takes which risk, and how does finance reach the last mile?
Illustrative design · programme bond or fund with a value-chain sleeve
Blended finance puts public, philanthropic and private money in one structure, each taking the risk it is suited to. This example shows the order in which losses and repayments fall, and how part of the money reaches farmers and local enterprises.
A programme, not a project
One project is too small for institutional money and too exposed to one harvest or one permit. A programme lines up a pipeline of screened, contracted and measurable projects.
It also keeps capacity in reserve for the projects that come next.
Three kinds of money
Institutions buy senior notes. A development bank provides a guarantee or a mezzanine layer. Philanthropy takes the first loss.
Each layer accepts a different risk, so each funder can take part on terms it can hold.
Losses rise from the bottom, repayments fall from the top
If the programme falls short, the first-loss layer absorbs it before the guarantee is touched, and the guarantee before senior money. When revenues come in, senior holders are paid first.
The layers are illustrative and not to scale.
Finance that reaches the last mile
A value-chain sleeve lends small amounts to many participants through local financial partners: inputs and seed, equipment, working capital and incentives to take part.
It is repaid from the income the programme creates.
Chapter 03 · At a glance
Programme bond or fund, with a value-chain sleeve
- Issuer
- A ring-fenced issuer, or a separate fund vehicle with its own manager
- Repaid from
- Pipeline cashflows, plus repayments from the sleeve
- Credit support
- First loss · guarantee or mezzanine · a reserve for new projects
- Investors hold
- Senior notes, or units in the fund
- Reaches
- Farmers and local enterprises, through local financial partners
- Evidence
- Programme measurement and verification · portfolio reporting
- Status
- Illustrative · Climate Securities would advise on structure, not manage the fund
Chapter 04 · State programme platform
04 / State programme platform
How does a state move from single projects to a programme it governs?
Illustrative design · sub-sovereign programme platform
Project by project
A state often seeks climate finance one project at a time, each with its own terms, its own evidence and its own reporting.
Capital sees many small, separate risks, and each one takes as long to arrange as the last.
One programme the state governs
Projects are brought into one programme. The state owns the outcomes and keeps authorisation. A public–private partnership sets roles, governance and benefit-sharing.
A programme vehicle issues notes against the governed pipeline, and programme revenues repay them.
Its own interfaces
The programme has its own Article 6.2 interface with the government, independent measurement and verification, and reporting to the registry, investors and the public.
Every public decision stays with the public body. Climate Securities structures and coordinates.
Chapter 04 · At a glance
Sub-sovereign programme platform
- Issuer
- A programme vehicle under a state public–private partnership
- Repaid from
- Programme revenues: offtakes, outcome sales and state contributions
- Credit support
- State undertaking · development-bank partial guarantee
- Investors hold
- Programme notes
- Stays with the state
- Ownership of the outcomes, authorisation and the registry interface
- Evidence
- Programme measurement and verification · state registry interface
- Status
- A Climate Securities design · illustrative
Route to market
From programme to paper, with the evidence alongside
Every structure on this page reaches investors the same way, and the evidence line runs independently of both sides.
From programme to paper
A programme's contracts and revenues sit in a ring-fenced issuer, which issues English-law notes. Coupons and principal are paid from the revenue waterfall.
The sovereign or community keeps title to the natural capital.
Regulated activity sits with authorised firms
An FCA-authorised arranger, or another authorised firm in its own jurisdiction, arranges, places and distributes the notes. Investors hold defined claims, never the asset.
Climate Securities is not authorised by the FCA. It designs, structures and coordinates.
Evidence runs alongside, independent of both
An evidence provider measures and models. An accredited verifier checks the results against the methodology the programme chose. A registry records title and issuance, and reporting continues for the life of the structure.
Climate Securities never measures or verifies anything itself.
The instruments
Six instruments, one discipline
Each starts from settled ownership and ends in paper an institution can hold. Sizes and terms are set programme by programme.
| Instrument | Issuer | Repaid from | Credit support | Evidence needed |
|---|---|---|---|---|
| Transition Sovereign Note | The sovereign, or a vehicle with a sovereign undertaking | Budget lines or refinanced debt service; outcome units step the coupon | Development-bank guarantee · philanthropic first loss | National measurement and verification · registry · Article 6.2 where used |
| Sub-sovereign programme platform | A programme vehicle under a state partnership | Offtakes, outcome sales and state contributions | State undertaking · development-bank partial guarantee | Programme verification · state registry interface |
| Stewardship-unit bond | A ring-fenced issuer | Take-or-pay stewardship units, receivables assigned to the issuer | Reserve account · first loss · development-bank anchor | Protection verified per square kilometre per year |
| Outcome-linked bond or note | A ring-fenced issuer, or alongside a development bank | An outcome payer pays on verified results; coupon or principal is linked | Outcome-payer undertaking | Independently verified outcome indicators |
| Renewable and transition infrastructure debt | A power producer's holding company or platform | Power purchase agreements and merchant revenue | Development-bank participation · hedging · security package | Generation and environmental covenant reporting |
| Programme bond or fund, with a value-chain sleeve | A ring-fenced issuer, or a separate fund vehicle | Pipeline cashflows plus sleeve repayments | First loss · guarantee · reserve for new projects | Programme verification · portfolio reporting |
Illustrative. Every programme is designed on its own terms. None of these instruments is offered or open for investment, and nothing on this page is investment advice.
Next step
Bring us a programme
Tell us about the programme, the delivery challenge and where you are in its development, and who owns the outcome today.