First sustainability-linked loan in New Zealand’s horticulture sector commits T&G to emissions reduction target
T&G Global has signed New Zealand horticulture’s first sustainability-linked Loan in the horticulture sector – borrowing NZ$180m (US$113m).
The three-year loan commits T&G to a science-based greenhouse gas emissions reduction target that aligns with limiting the global average temperature increase to 1.5°C above pre-industrial levels.
The loan also requires T&G to undertake a comprehensive climate risk adaptation plan to enable T&G to adapt to the impacts of a changing climate and create permanent job opportunities and career pathways to help boost regional development.
As part of the loan financing, T&G will pay lower loan costs if it achieves the sustainability targets and will have to pay penalties if these aren’t met.
T&G chief executive Gareth Edgecombe said the loan is a critical and strategic move towards long-term sustainability.
“We’re committed to making positive changes and transitioning to a healthier and more sustainable future,” said Edgecombe.
“Our sustainability-linked loan and its ambitious targets demonstrate our commitment to embracing sustainable practices and meeting global consumer needs. This includes helping New Zealand transition to a low-carbon economy by decarbonising our business and adapting to a changing climate, as well as building thriving local communities.
“At T&G, kaitiakitanga is a value we demonstrate everyday, and it captures what sustainability means to us – treating the land, people, produce, resources and community with the greatest of respect and care, as guardians of their future. This loan ensures we keep sustainability at the forefront of our business.”
The loan follows T&G achieving its first climate objective of sourcing 100 per cent of electricity from renewable sources. This was achieved by implementing energy efficiencies and switching to renewable electricity certificates to cover domestic and international electricity consumption per year, which has resulted in zero emissions from T&G’s scope two activities.
Doug Bygrave, T&G chief financial officer said the loan is an important milestone in T&G’s 125-year history.
“T&G has a strong history of taking care of an environment we significantly rely on and looking after our people. We know the creation of permanent roles and the fostering of careers not only benefits individuals and families, but the benefits flow deep into local communities.
“By working with our principal banks Rabobank and BNZ as joint sustainability co-ordinators, (as well as participation from HSBC and Westpac), we’ve structured a loan that sets clear and meaningful targets, which upon delivery, will deliver improved cost of capital and further embed sustainability within T&G.
“This loan incentivises us to invest in climate change mitigation and adaptation activities. A key focus is the decarbonisation of our transport fleet and glasshouses, as well as electricity efficiency. It’s a big challenge, and our targets in the loan reflect our ambition to limit our impact and adapt.”