Pernod Ricard signs inaugural sustainability-linked loan exceeding €2bn

The French multinational announced the loan late last week, confirming that it will refinance in advance an existing credit facility that will expire next summer.

Under the new loan, Pernod Ricard will benefit from preferential rates if it meets or exceeds its ambitions to reduce greenhouse gas emissions and improve water efficiency.

The loan’s terms are linked to the company’s 2C-aligned science-based climate target to reduce absolute Scope 1 (direct) and Scope 2 (power-related) emissions by 30% by 2030, against a 2018 baseline.  Also linked is the company’s target to reduce water intensity by 20% between 2020 and 2030.

Pernod Ricard has already recorded a 15.6% reduction in Scope 1 and 2 emissions since 2010 and a 13.4% reduction in water production intensity since 2018.

It bears noting that 94% of Pernod Ricard’s emissions footprint is indirect (Scope 3). The new loan is not linked to the delivery of the company’s pledge to halve, on an intensity basis, Scope 3 emissions from purchased goods and services and upstream transportation by 2030.

The new loan has an initial April 2028 maturity and has two one-year extension options. It follows on from two sustainability-linked bonds from Pernod Ricard, issued in 2022 and totalling €1.85bn.

Pernod Ricard’s chief sustainability officer Vanessa Wright said the new loan “is another demonstration of our drive to reduce our environmental footprint and protect the natural ecosystems, where we source all the ingredients that make our iconic brands”.

Brands owned by Pernod Ricard include Beefeater gin, Absolut vodka, Malibu rum and Jameson and Glenlivet whiskies.

Pernod Ricard is one of many firms to have linked sustainability performance to bonds and/or loans. The likes of Kingfisher, Kingspan, AB InBevThai Union and Tesco, which is now also supporting suppliers to follow suit, have all announced similar loans.

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