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WFW Provides Pro Bono Legal Counsel on Pegasus Principles Development

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WFW Provides Pro Bono Legal Counsel on Pegasus Principles Development

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Watson Farley & Williams (WFW) is proud to have served as the sole legal to RMI and a consortium of leading banks, including BNP Paribas, Citi, Crédit Agricole CIB, Societe Generale, and Standard Chartered (the "Working Group"), in the development and launch of the ground-breaking Pegasus Principles

These principles establish a pioneering framework for banks to assess and disclose the emissions associated with their aviation lending portfolios independently.

The Pegasus Principles represent a significant step forward in climate-aligned finance for the aviation sector. They enable banks to measure and disclose the climate alignment of their aviation lending portfolios in comparison to a 1.5°C scenario, with the aim of achieving net-zero emissions by 2050.

The aviation industry contributes substantially to global CO2 emissions, making up 2.5% of the total. As the fastest-growing transportation sector, decarbonizing aviation will require significant efforts, including ramping up the use of sustainable aviation fuels and advancing hydrogen and battery-electric propulsion technologies.

Developed by RMI and shaped by the Working Group, the Pegasus Principles draw upon established standards such as those set by the Science Based Targets initiative (SBTi) and the International Civil Aviation Organization’s Carbon Offsetting and Reduction Scheme for International Aviation (ICAO CORSIA). The framework aligns with the guidelines of the Net-Zero Banking Alliance.

Several banks, including CaixaBank and CIC, are already adopting this methodology, while others are testing its implementation for potential future adoption. The Pegasus Principles build upon the success of similar climate-aligned finance frameworks, such as the Poseidon Principles for the maritime sector, which aim to reduce shipping's greenhouse gas emissions by at least 50% by 2050.

Patrick Moore, Partner at WFW, led the legal team advising RMI and the Working Group on the development of the Pegasus Principles. He emphasized the firm's commitment to sustainability and its expertise in climate-aligned finance frameworks. Moore highlighted WFW's previous involvement in initiatives such as the Poseidon Principles and various sustainability-related transactions, underlining the firm's leadership in promoting sustainable practices within the transport sector.

The collaboration between WFW, RMI, and the Working Group underscores the collective effort to address climate change challenges and promote sustainable finance solutions within the aviation industry.

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