First plastic waste reduction bond launched

Düsseldorf-headquartered Henkel has launched plastic waste reduction bond

A German chemical and consumer goods company has announced the launch of a plastic waste reduction bond

Düsseldorf-headquartered Henkel has launched the plastic waste reduction bond with the proceeds used to finance specific plastic waste reduction activities in line with Henkel’s packaging targets for 2025.

The group said it understands it is the first company globally to launch a bond of this kind. It has been seeded via private placement by Japanese insurance companies Dai-ichi Life and Dai-ichi Frontier Life, and has a total volume of $70m and a maturity of five years.

Marco Swoboda, CFO at Henkel, said: “We are proud to be the first corporate issuer of a plastic waste reduction bond, once more demonstrating our ability to conclude innovative sustainable investment instruments at attractive terms. By linking financing concepts to our plastic waste reduction initiatives, the Finance team shows its continuous commitment to actively contributing to our sustainability agenda.”

“Sustainability is not only firmly embedded in our strategic framework for the future but also increasingly relevant for investors and the financial markets.”

The group said it was also the first company in Germany to conclude a syndicated ‘Sustainability linked Loan’ in 2018, a credit facility linked to Henkel’s performance in three independent sustainability ratings.

Sylvie Nicol, member of the Henkel Management Board responsible for Human Resources and Sustainability, emphasised plastic waste reduction is a particular focus for the group: “Plastic waste is one of the biggest environmental challenges globally. We have reaffirmed our clear commitment to accelerate our sustainability actions and are working towards ambitious targets for reducing plastic waste and fostering a circular economy.

“This plastic waste reduction bond is a strong signal of our conviction that especially in times like these, in midst of the current Covid-19 crisis, we need to step up our efforts to promote sustainable solutions and concepts across the whole organization and along the entire value chain.”

In other moves to underline its commitment to reduce plastic waste, Henkel has said by 2025, 100% of the company’s packaging will be recyclable or reusable, the amount of fossil-based virgin plastics will be reduced by 50% and it will also help prevent waste from being disposed in the environment.

Henkel is also engaged in several partnerships and cross-industry initiatives that aim to drive innovation in packaging development and the transition towards a circular economy. The company is also a founding member of the Alliance to End Plastic Waste (AEPW) and partner of the Plastic Bank.


Natalie Kenway

Natalie is editor in chief at MA Financial covering ESG Clarity, Portfolio Adviser and International Adviser. She was previously global head of ESG insight for ESG Clarity and has been an investment journalist...