HSBC Hong Kong is enhancing its sustainable finance offerings through the introduction of the Sustainability Improvement Loan, tailored for mid-market and smaller businesses. This innovative solution aligns financing costs with sustainability performance, bolstering Hong Kong’s array of sustainable finance options and bolstering its status as a global hub for sustainable finance.
The interest rates for the Sustainability Improvement Loan are tied to changes in borrowers’ sustainability assessments and ratings provided by EcoVadis, a leading evaluator of business sustainability across Environment, Labour and Human Rights, Ethics, and Sustainable Procurement.
Borrowers accessing Sustainability Improvement Loans must undergo an annual sustainability assessment throughout the loan term. Improvements in assessment scores can lead to reduced interest rates, while declines may result in higher rates.
HSBC recently concluded its inaugural Sustainability Improvement Loan transaction in the Asia Pacific region with Opal Cosmetics, a Hong Kong-based global supplier of personal care and beauty products. The funds will support Opal Cosmetics’ operational and R&D needs.
Alice Suen, Managing Director, Head of Sustainable Finance and Investments, Hong Kong HSBC said, “Businesses in the early stages of their sustainability journeys often find conventional Sustainability-Linked Loans beyond their reach, primarily due to limited resources for measuring and reporting their ESG performance. We are pleased to introduce Sustainability Improvement Loan in Hong Kong, a new solution that improves businesses’ access to sustainable finance. At HSBC, we will continue to explore new and impactful ways to incentivise and support customers of all sizes as they take meaningful steps in their sustainability journeys.”
Richard Bourne, Senior Vice President, Asia-Pacific Japan, EcoVadis said, “We are excited to collaborate with HSBC on this innovative Sustainability Improvement Loan, which underscores the importance of sustainability in business resilience and growth. Our assessments empower companies to benchmark their sustainability performance, identify areas for improvement and drive meaningful impact. We aim to provide businesses with greater access to financing linked to sustainability outcomes, encouraging a broader shift towards more sustainable practices in the region and delivering impact.”
These loans are available for eligible HSBC customers seeking new facilities or refinancing to cover existing facilities. They include a variety of business loans, including revolving credit facilities, term loans, and selected trade finance products.