UK clothing brand Burberry has refinanced its revolving credit facility (RCF) to a £300 million sustainability-linked loan coordinated by Lloyds Bank.
The facility is linked to the achievement of environmental, social, and governance (ESG) targets as part of the company’s ‘Climate Positive by 2040’ campaign.
This includes accelerating Scope 3 emissions reductions across Burberry’s extended supply chain by 46% by 2030, and becoming net zero by 2040, 10 years ahead of the 1.5°C pathway set out in the Paris Agreement.
The deal is one of the first sustainability-linked RCFs to be coordinated by Lloyds Bank since the launch of its new Sustainability and ESG Financing team in April 2021.
Burberry’s green journey
In a press statement, Burberry said the loan builds on the company’s efforts to embed ESG across its operations, including its sources of financing.
In September 2020, Burberry became one of the first luxury clothing brands to issue a sustainability bond, enlisting the support of investors to finance company sustainability projects.
These included refurbishing Burberry properties with Platinum or Gold certification in Leadership in Energy and Environmental Design (LEED), or Excellent or Outstanding certification in the Building Research Establishment Environmental Assessment Methodology (BREEAM1).
Burberry’s previous bonds also focused on ensuring that natural resources are sourced sustainably and pollution from packaging is prevented.