Walmart raises $2bn through first green bond

US-based retail giant Walmart has announced the closing of its inaugural green bond issuance, raising $2bn for initiatives that will decrease emissions and resource use, increase resource efficiency and conserve nature.

Walmart raises $2bn through first green bond

The company is more than halfway to Project Gigaton

The announcement was made late on Thursday (23 September). Funding will be put towards projects which meet the eligibility criteria of Walmart’s own Green Financing Framework, which was published last month.

Projects set to benefit from the bond proceeds include renewable energy generation schemes, energy efficiency improvements for buildings and the purchase of low-carbon vehicles, including electric and hydrogen options.

Walmart is notably aiming to reach net-zero operational emissions by 2040, without the use of offsetting, and to source and generate 100% renewable electricity by 2035.

Also set to receive a share of the bond proceeds are projects focused on waste prevention and recycling across the supply chain; stores and communities in which Walmart operates, with a particular focus on packaging.

Projects improving water stewardship efforts and initiatives to conserve, restore and create natural habitats also meet the eligibility criteria of Walmart’s Green Financing Framework.

At Climate Week NYC this week, Walmart’s president and chief executive Doug McMillon announced that the business is adopting a vision to become a regenerative business. Targets have been set to protect, manage and restore at least 50 million acres of land and one million square miles of ocean by 2030

The green bond is part of $7bn of new senior unsecured notes that Walmart successfully closed this financial year. Therefore, green finance makes up around 29% of Walmart’s overall finance-raising activities.

Active bookrunners on the deal were AmeriVet Securities, C.L. King & Associates, Samuel A. Ramirez & Company, Siebert Williams Shank, BofA Securities, Citigroup Global Markets and Morgan Stanley. BofA Securities. was the green structuring agent, while Citigroup Global Markets served as diversity and inclusion coordinator.

“This green bond signals that we continue to make headway,” Walmart’s executive vice-president and chief sustainability officer Kathleen McLaughlin said. “We remain steadfast in our commitment to addressing climate change, transitioning to a circular economy and restoring natural ecosystems, all while supporting the communities in which we operate.”

Earlier this month, the Climate Bonds Initiative released an updated forecast projecting that global green bond issuance is likely to pass the half-a-trillion-dollar mark this year and that the possibility of issuance surpassing $1trn in 2023 is strong.  The US is the largest market for global, green and sustainability bond issuance. It took 17% of the global share in the first half of 2021.

Sarah George

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