GHG Emissions, Commercial, Finance, Industrial  -  April 25, 2019

Walmart partners on finance options for supply chain sustainability

Walmart suppliers who demonstrate progress in their sustainability credentials will have access to improved financing from HSBC, thanks to a partnership between the two companies.

Suppliers’ progress will be measured against Walmart’s Project Gigaton and Walmart Sustainability Index Program, developed by The Sustainability Consortium. Project Gigaton is Walmart’s initiative to rid one billion metric tons (a gigaton) of GHG emissions from their global value chain by 2030.

A statement from HSBC explained, “The ecosystem of businesses that operate in any one supply chain are one of the most important levers for businesses to create a positive effect on the world. Typically the businesses in a supply chain account for more than 80% of greenhouse-gas emissions. So, the role that international banks have to play in supporting companies’ transition to become more sustainable is paramount to business sustainability more generally.”

Financial support can take several forms, according to the statement, from traditional green lending to program-based lending that finances the investment needed by key suppliers to put the tools and equipment in place that lessen impact on the environment. This can range from reducing energy consumption through to water treatment plants. Supply chain finance programs can also use variable pricing to incentivize suppliers to meet sustainability targets.

 “Trade is a force for good, and trade finance has a vital role to play if we are to achieve the Sustainable Development Goals”, says Natalie Blyth, Global Head of Trade and Receivables Finance at HSBC. “Embedding sustainability in global supply chains is not only beneficial for the environment and society, but also for companies’ bottom lines"

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