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IA publishes updated ‘Governance and Disclosure Guidelines for Housing Associations Seeking Capital Markets Funding’


In recent years, housing associations have increasingly turned to the debt capital markets to meet their long-term funding needs. Since 2012, housing associations have raised nearly £34 billion of debt in capital markets, to supplement £27 billion raised through banking financing.  

Investment managers, on behalf of their insurance and pension fund clients, play a key role in providing this funding to the sector. For investors seeking to provide for savers’ long-term futures and pensions, housing association debt is an attractive investment due to:  

  • stable predictable income streams;  

  • government support through capital grant, housing benefit and Universal Credit, and regulation;  

  • a relatively limited range of alternative long-dated sterling opportunities; and  

  • strong investment grade ratings, typically between A+ and BBB, with the majority in the A and A- categories.  

As a result, the relationship between institutional investors and housing associations is particularly important and has only grown more so over recent years.  

To this end, in 2017 the Investment Association (IA) published ‘Governance and Disclosure Guidelines for Housing Associations Seeking Capital Markets Funding’. These guidelines set out investor expectations for housing associations seeking funding, including on disclosures providing greater transparency as to how housing associations are performing and how they are governed.  

Transparency is essential for issuers of securities in capital markets, including housing associations, as this has an impact on investor confidence, as well as on pricing in secondary markets. It also affects the ability of housing associations to attract a broader investor base. In addition, there are regulatory requirements that require investment managers to make certain disclosures to be made on a timely basis. 

As the market has evolved, so too have investor expectations, particularly around disclosures relating to sustainable finance and environmental, social, and governance (ESG) reporting. 

As a result, the IA has today published its updated ‘Governance and Disclosure Guidelines for Housing Associations Seeking Capital Markets Funding’, which has been drawn up after lengthy consultation with members and other stakeholders. These guidelines, along with reiterating those expectations previously laid out, also call for greater disclosures relating to ESG issues, such as environmental disclosures, including emissions data, and social disclosures such as information on pay gaps and qualitative discussions of social impact.  

We hope that these guidelines will not only provide a valuable tool for housing associations looking to understand investor expectations ahead of seeking funding (as well as during ongoing engagement with their investors), but also help to drive improvements in ESG reporting across the sector. 

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