Whirlpool brings sustainability home

US-based manufacturer’s inaugural sustainability bond will fund development of eco-efficient appliances and various environmental and social initiatives

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Whirlpool Corporation, one of the world’s leading kitchen and laundry appliance companies, is connecting how daily tasks such as cooking and cleaning can contribute to a more sustainable future through innovative financing with its first-ever Sustainability Bond.

The $300m, 10-year issuance launched in late April is the first sustainability bond from a US-based appliance firm and is Whirlpool’s latest milestone on a sustainability journey that goes back 50 years. BNP Paribas served as the sole Sustainability Structuring Agent as well as an active bookrunner on the transaction, which generated strong investor interest.

Driving positive environmental and societal impacts

Sustainability has been an essential part of Whirlpool’s heritage since CEO Elisha “Bud” Gray wrote a letter to shareholders 50 years ago on the importance of sustainability and the company’s need to engage in societal and environmental issues.

Since then the company – whose appliance brands include Whirlpool, KitchenAid and Maytag – has aligned its activities to that mission, developing products that increase efficiencies in time, water and energy use, wins for customers and the environment. This focus on efficiency is embedded in the firm’s newly introduced Sustainability Bond Framework, which is aligned with ICMA principles and includes seven key categories for use of proceeds:

  1. Eco-efficient Products
  2. Renewable Energy
  3. Energy Efficiency
  4. Green Buildings
  5. Pollution Prevention and Control
  6. Socioeconomic Advancement and Empowerment
  7. Access to Basic Infrastructure

“Over the course of our 110-year history, Whirlpool Corporation has remained committed to designing and building products that exceed our consumers’ expectations while investing to care for our communities and the planet,” said Jim Peters, Whirlpool’s chief financial officer, in a press release. “We’re encouraged that there was such strong demand from investors and believe the issuance of the bond reflects on our core philosophy that sound corporate citizenship and environmental performance are good for business.”

Broad ambitions

Eligible expenditures under the framework highlight Whirlpool’s sustainability ambitions, including projects such as circular economy-adapted products (those that are designed or made with recyclable materials), and connected household appliances with demand response capabilities that reduce energy, water, or emissions.

The framework also covers projects featuring renewable energy, energy efficiency, green buildings and pollution prevention. Whirlpool also added a social impact component to the framework to improve diversity and economic inequality in the communities in which it operates.

“Whirlpool has a long history of embedding environmental and societal initiatives into its business strategy,” said Anne van Riel, Co-head, Sustainable Finance Capital Markets Americas at BNP Paribas. “This framework is a testimony of the continued focus on innovation to produce eco-efficient products, a responsibility for Whirlpool’s own footprint and a concern for the communities in which it operates.”

This transaction demonstrates how a consumer corporate can successfully incorporate sustainability goals into their financing initiatives.

Anne van Riel, Sustainable Finance Capital Markets Americas at BNP Paribas

Where feasible, Whirlpool will report on the relevant impact metrics of the bond’s eligible projects within one year from issue. These metrics may include greenhouse gas reduction, growth in the amount of company facilities that are LEED certified (by square feet), a percentage increase in zero waste to landfill sites, and the number of people who received access to quality, resource-efficient housing.

Through this inaugural sustainability bond, Whirlpool is demonstrating that sustainability in its products, operations and supply chain is not only good for the environment but good business as well.

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