Weather wreaks havoc with bottom lines
Weather events like Cyclone Gabrielle that hit over one year ago have landed two of the country's biggest fruit and vegetable traders with massive trading losses.
The three-year loan commits T&G to a science-based greenhouse gas emissions reduction target that aligns with limiting the global average temperature increase to 1.5°C above pre-industrial levels.
The loan also required T&G to undertake a comprehensive climate risk adaptation plan to enable the company to adapt to the impacts of a changing climate, and create permanent job opportunities and career pathways to help boost regional development.
T&G chief executive Gareth Edgecombe says the loan is a critical and strategic move towards long-term sustainability.
“We’re committed to making positive changes and transitioning to a healthier and more sustainable future,” says Edgecombe.
“Our Sustainability-Linked Loan and its ambitious targets demonstrates our commitment to embracing sustainable practices and meeting global consumer needs. This includes helping Aotearoa New Zealand transition to a low-carbon economy by decarbonising our business and adapting to a changing climate, as well as building thriving local communities,” he says.
“At T&G, kaitiakitanga is a value we demonstrate everyday, and it captures what sustainability means to us – treating the land, people, produce, resources and community with the greatest of respect and care, as guardians of their future. This loan ensures we keep sustainability at the forefront of our business.”
The loan follows on from T&G achieving its first climate objective of sourcing 100% of electricity from renewable sources. This was achieved by implementing energy efficiencies and switching to renewable electricity certificates to cover domestic and international electricity consumption per year.
Doug Bygrave, T&G chief financial officer, says the loan is an important milestone in the company’s 125-year history.
“T&G has a strong history of taking care of an environment we significantly rely on and looking after our people. We know the creation of permanent roles and the fostering of careers not only benefits individuals and families, but the benefits flow deep into local communities,” he says.
“By working with our principal banks Rabobank and BNZ as Joint Sustainability Co-ordinators, (as well as participation from HSBC and Westpac), we’ve structured a loan that sets clear and meaningful targets, which upon delivery, will deliver improved cost of capital and further embed sustainability within T&G.
“This loan incentivises us to invest in climate change mitigation and adaptation activities. A key focus is the decarbonisation of our transport fleet and glasshouses, as well as electricity efficiency. It’s a big challenge, and our targets in the loan reflect our ambition to limit our impact and adapt.”
Deloitte Limited have undertaken services to assess T&G Global Limited’s Sustainability-Linked Loan Framework, key performance indicators, and targets against Sustainability-Linked Loan principles issued by the Loan Market Association and the Phase One Guidance for Sustainable Agriculture Finance for Crops guidance issued by the Sustainable Agriculture Finance Initiative in July 2021.
