Apparel Group, a UAE-based fashion and retail conglomerate, has signed its first bilateral long-term sustainability-linked loan (SSL) with Mashreq, one of the leading financial institutions in the Mena region.
The performance-linked financing aims to propel Apparel Group's sustainability journey by establishing ambitious targets and achieving tangible outcomes. By leveraging performance-linked financing, the group can drive its sustainability initiatives, ensuring measurable progress towards their objectives. As part of the deal, Mashreq will closely monitor Apparel Group’s progress in meeting its sustainability objectives.
Mashreq plays a critical role in enabling the adoption of Apparel Group’s sustainable practices. This involves carefully choosing SPIs that are in line with Apparel Group’s core sustainability and business strategy while addressing significant environmental, social, and governance (ESG) factors within the fashion industry. In addition, Mashreq takes on the responsibility of calibrating the Sustainability Performance Targets (SPTs) under the selected SPIs. These targets are designed to remain applicable throughout the loan term. By setting ambitious targets and offering incentives, sustainability-linked loans strive to foster positive change and inspire impactful actions within the industry.
Joel Van Dusen, Group Head of Corporate Banking & Investment, Mashreq said: “By signing this bilateral long-term sustainability-linked loan with Apparel Group, Mashreq is demonstrating its commitment towards sustainable financing as a serious and increasingly important consideration for businesses across all industry sectors. We recognize that corporations are responsible for implementing environmental, social, and governance (ESG) sustainability practices, and we are dedicated to helping Apparel Group prioritize crucial issues such as gender equality and responsible sourcing.”
Neeraj Teckchandani, CEO of Apparel Group, said: "This inaugural sustainability-linked loan with Mashreq is a strategic move aligning with Apparel Group's vision to infuse sustainability into every facet of our operations. Beyond mere funding, the financial framework of this agreement serves as a catalyst, supporting us to achieve our sustainability goals closely linked to environmental, social, and governance (ESG) factors. We're forging a new path in the fashion and retail industry, one that links financial growth and sustainability. As we collaborate closely with Mashreq on this journey, we aim to set new standards in areas such as diversity, inclusion, and responsible sourcing. This partnership is a strategic pillar in our broader vision of spearheading sustainable practices, ultimately fostering a more sustainable future for our stakeholders and the planet.”
Joel added: “By leveraging innovative financial instruments to incentivise sustainable practices, Mashreq aligns financial incentives with impactful ESG goals. Doing so demonstrates our commitment to paving the way to a more equitable, responsible, and environmentally conscious future. Furthermore, by leading the evolution of sustainable financing, we are pushing for serious, positive change towards a sustainable future that delivers for all stakeholders.”-- TradeArabia News Service