The Hong Kong and Shanghai Banking Corporation (HSBC) in Bangladesh has created the country’s first ever sustainability-linked loan for DBL Group, one of Bangladesh’s major knit garment makers and exporters, focusing on Sustainable Development Goal (SDG) 5: Gender Equality.
According to a news release, sustainability-linked loans attempt to improve a borrower’s sustainability profile by matching loan conditions to their performance against pre-determined Sustainability Performance Target (SPT) benchmarks.
Under this unique inventivised sustainable loan agreement, interest rates are tied to two areas of performance – the increased percentage of female supervisors employed and greenhouse gas emissions reductions.
Commenting on the landmark signing, M A Jabbar, Managing Director, DBL Group said, “Encouraging female leadership is not only the right thing to do but also has a clear business case. We have observed marked improvement of quality control with female supervisors and now are encouraged to see global financial institutions like HSBC offering economic incentives to do more. We look forward to partner with HSBC in building an equal and sustainable future.”
