(Credit: Pixabay)With sustainable financing remaining a strong tool to help businesses, several agreements have recently been made to help companies achieve certain targets or improve climate resiliency.
Commercial real estate company CBRE has entered into a five-year agreement that increases its sustainability-based revolving credit facility from $3.15 billion to $3.5 billion. Additionally, insurance company FM Global is issuing what it calls a resilience credit worth $300 million to its policyholders.
The CBRE credit facility includes financing for sustainability goals, including building improvements, using sustainable suppliers, and converting its North American fleet to electric vehicles. The company has a goal to achieve sustainability certificates for its offices that have more than 10,000 square feet of space.
Credit facilities are pre-approved loans that give the borrower access to money on an ongoing basis rather than applying for new loans each time more money is needed. Sustainability-linked loans are geared toward helping borrowers achieve predetermined sustainability targets.
EY, Ericsson, Enel, and KLA are among the companies that secured significant revolving sustainability-based credit over the past year.
FM Global’s credit to its policyholders, which it says includes one of every three Fortune 500 companies, will help those organizations reduce total loss expectations against natural events, including floods and wildfire by more than $120 billion. The company says according to its data that protection can help those organizations with a positive impact on customers and communities.
The credit will be applied as a 5% premium offset against FM Global policies with renewals or anniversaries between Oct. 1, 2022, and Sept. 30, 2023. The company says the credit is made possible through its mutual ownership structure and risk engineering to help support business continuity and climate risk mitigation.
FM Global is also introducing new climate resilience offerings later this year that will help organizations assess climate risk exposures and prioritize their risk improvement investments.
Such risks have become more of a focus for companies as natural impacts on their operations increase. So far in 2022, there have been nine natural events in the United States with more than a billion dollars in damage, according to the National Oceanic and Atmospheric Administration.
Overall, sustainability financing is down this year after a record pace in 2021. That hasn’t stopped financing such as CBRE’s, green loans like Vantage Data Center’s recent deal worth $300 million, or PepsiCo’s $1.25 billion sustainability bond.
