Commercial, Finance, Sourcing Renewables - November 28, 2023
H&M Group Partners for Green Loan Program
H&M Group is leading an effort to establish collaborative financing solutions to enable the decarbonization of fashion supply chains.
The apparel retailer partnered with DBS, a Southeast Asia bank, to initiate a collaborative finance tool – a green loan program that facilitates supply chain decarbonization in the apparel sector.
“H&M Group has been engaged in climate mitigation for years and we continuously push ourselves to demonstrate climate leadership within our industry,” said Ulrika Leverenz, Head of Green Investment, H&M Group, in a statement. “We see that our industry is committed to tackle its negative climate impact. But we also see that impactful climate action requires collaborative financing. For us, sustainability investments are not only a responsible approach but a strategic necessity for future success.”
H&M Group has focused on making funding available to reduce GHG emissions across - and beyond - its own supply chain. Its Green Fashion Initiative enables factories to invest in the technologies and processes needed to reduce energy demand and replace fossil fuels throughout the fashion industry.
Through a new program, suppliers get access to financing from DBS and technical support from sustainability consultant, Guidehouse, to embark on factory upgrades to decrease their climate impact.
This program provides financing with highly favorable terms to suppliers for specific GHG emission reduction activities, as approved by H&M Group.
In 2023, the collaborative finance tool completed the first successful transaction with a manufacturer in India to fund capital expenditures to reduce Scope 3 GHG emissions. With the support of the loan, supplier Raj Woollen financed the installation of solar panels, energy-efficient motors, and water conservation technologies to conserve resources and reduce carbon emissions.
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