Food industry shows growing appetite for green finance

 Food industry shows growing appetite for green finance

Call it a virtuous circle. As the number of companies pursuing sustainability has grown, so has the market for sustainability finance — which, in turn, is encouraging more companies to go green. Agribusinesses, under pressure in areas ranging from greenhouse gas emissions to biodiversity, are increasingly keen to join in.

Sustainability-linked loans (SLLs) have proved a particular area of interest. Barely four years old, the market has grown to $330bn of new issuance so far this year from about $50bn in 2018, according to research published this month by Bank of America. “Sustainability-linked loans have seen tremendous growth in the last few years,” BofA says.

Under the terms of these lending arrangements, companies must pay investors higher interest rates if they fail to hit agreed sustainability targets. But the companies like SLL deals for the flexibility they grant over use of the proceeds — a key…

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