Marks and Spencer, one of the UK’s largest retailers has integrated its new net zero strategy into its financing approach by embedding emissions reduction focused KPIs into its latest £850mn lending facility. BNP Paribas was sole Sustainability coordinator, sole Documentation and RFR co-ordinator and joint mandated lead arranger and bookrunner on the sustainability-linked loan (SLL) which aligns with the Sustainability-Linked Loan Principles.
The company recently reset Plan A, to focus on achieving net zero (including scope 3) by 2040. The SLL supports M&S Plan A objectives through targeting four environmental KPIs which are part of the roadmap to net zero and will be publicly reported on an annual basis, including:
- KPI #1: Percentage of soy from physically certified deforestation and conversion free supply chains
- KPI #2: Percentage of polyester in clothing and home products coming from verified recycled sources
- KPI #3: Reducing Scope 1 and 2 emissions from property estate
- KPI#4: Cumulative number of individual disposable units of plastic packaging that have been removed from packaging portfolio
Sustainable finance is quickly gaining traction as it highlights the financial, as well of societal, benefits, of net zero adoption…in our case, we worked with the expert sustainability team at BNP Paribas to structure our credit facility to support the rapid decarbonisation required in our business.James Rudolph, Group Treasurer, M&S
The signalling effect of M&S embedding robust deforestation, emissions and circular economy targets into their financing approach demonstrates how sustainable finance can scale up net zero in a scientifically transparent way.Anne Marie Verstraeten, UK Country Head BNP Paribas
In terms of net zero levers across finance, BNP Paribas teams have been at the forefront of developing the market and the bank ranks number one in the EMEA ESG linked loans by book runner from Dealogic as of Nov 2021.
*Photo Credit: M&S