H&M to raise funds through green bond sale

Category: General

Country: Sweden

By Haydn Davis
18th October 2023

STOCKHOLM - H&M Group has announced plans to issue its first green bond sale with the funds earmarked for investment in working towards its previously announced sustainability targets.

With a target of €500 million ($843 million), the proceeds will be targeted at projects that will increase its use of recycled materials and renewable energy as well as expanding its development of sustainable water projects.

In a document issued in August, H&M Group outlined its latest sustainable finance framework, which enables the provision of green financing and sustainability-linked financing instruments.

The green finance instruments are being used to fund projects that enable the transition to a low carbon and circular economy such as investments in environmentally friendly buildings, renewable energy, energy efficiency, sustainable water management and wastewater management. The sustainability-linked finance instruments, meanwhile, are being used to promote progress towards its own 2030 sustainability targets such as the sourcing of fabrics and garments made from organic or recycled fibres and yarns.

In its most recent sustainability report, H&M noted that 84% of its materials were either recycled or sourced in a more sustainable way in 2022, which takes the company closer to its goal of having 100% of materials being recycled or sustainably sourced by 2025.

It also reported a 7% absolute reduction of greenhouse gas emissions in scope 3 and 8% absolute reduction in scopes 1 and 2 compared to a 2019 baseline – contributing to the target to reduce absolute emissions by 56% by 2030.

H&M also referenced a new 2030 water strategy, highlighting how it has reduced its water consumption per product by 38% compared to the 2017 baseline.

“The H&M Group has an ambition to lead the change towards achieving a circular fashion industry with net-zero climate impact,” the company said in the preface to its Sustainable Finance Framework. “Our sustainable finance framework provides an opportunity for investors to learn about our influence to drive positive transformation within the fashion industry.

“We have set ambitious sustainability goals, which to the greatest possible extent are based on latest science, best practice and knowledge. To achieve them, we need to work closely together with our suppliers and partners.”

Courtesy: Ecotextile.com