H&M in 2021 launched a 500 million euro sustainability bond with the fast fashion retailer stating at the time it received significant bond market attention for its sustainability initiatives. On Monday the Swedish conglomerate said it is launching a green bond, a type of bond where funds are linked to specific projects.
Fast fashion brands have faced criticism in recent years, prompting them to pivot towards more sustainable practices and safeguard their brand reputation. The rapid turnover of fashion styles has contributed to heightened carbon emissions and a surge in clothing waste, said Bloomberg.
In its 2021 report, H&M recognized the potential risks to its business if consumers increasingly favoured products and services from environmentally responsible companies that are leaders in sustainability. Several other clothing brands, such as Burberry and Mango, have also linked their borrowing activities to green initiatives, Bloomberg noted.
H&M said its Green Finance Framework outlines qualified projects falling within the International Capital Market Association (ICMA) categories, encompassing the circular economy, green buildings, renewable energy, energy efficiency, and sustainable water and wastewater management. Simultaneously, the Sustainability-Linked Finance Framework incorporates H&M group’s 2030 objectives, relating to the proportion of recycled materials in commercial products and reductions in greenhouse gas (GHG) emissions.
Source: Fashion United