ICC Ratifies Principles for Social Trade Finance and Sustainability-Linked Supply Chain Finance

The International Chamber of Commerce (ICC) has formally ratified the Principles for Social Trade Finance (PSoTF) and the Principles for Sustainability-Linked Supply Chain Finance (PSL-SCF). These new standards complete the ICC Principles for Sustainable Trade Finance (PSTF), establishing the first fully standardized global framework for assessing sustainability within the trade finance sector. By providing clear definitions and transparent guidelines, the framework aims to help banks and corporates align their financing activities with the UN Sustainable Development Goals and the Paris Agreement.

The ratification of the PSoTF and PSL-SCF follows an extensive public consultation process initiated at the United Nations’ 4th Financing for Development Conference in Seville. Developed in collaboration with Boston Consulting Group (BCG), these principles were shaped by input from over 100 banks, corporations, and technology platforms. This collaborative effort ensures that the framework is practical and comparable across various geographies and product types, addressing the need for a unified standard in the complex global trade ecosystem.

The newly finalized PSTF framework integrates with the existing Principles for Green Trade Finance (PGTF), which have already received public endorsements from major financial institutions including Standard Chartered, Santander, BNP Paribas, and Société Générale. By completing this suite of standards, the ICC provides a comprehensive mechanism for the trade finance market to assess and communicate sustainability performance. This standardization is critical for mitigating the risks of greenwashing and social-washing, which have historically hindered the growth of sustainable finance initiatives.

For the supply chain finance sector, these principles offer a roadmap to effectively channel capital toward sustainable and inclusive trade. The framework is designed to support the Paris Agreement’s objective of limiting global warming to 1.5°C while promoting social responsibility throughout global supply chains. ICC is now calling on stakeholders across the market to endorse the new social and sustainability-linked principles to foster a more transparent and harmonized digital trade environment.