Gildan Links Loan Agreement To Its Sustainability Goals
Gildan Activewear Inc. (PPAI 250187, S13) has signed an amended and restated credit agreement in respect of the Montreal-based supplier’s existing $1 billion revolving credit facility to incorporate sustainability-linked terms.
The Amendment: Gildan’s amended and restated $1 billion five-year revolving credit facility includes terms that reduce or increase the borrowing costs based on the company's annual performance against three of its recently announced environmental, social, and governance (ESG) targets. Gildan is the first Canadian apparel manufacturing company to tie financing costs to the achievement of ESG targets.
• Climate Change: The reduction of Gildan’s scope 1—direct emissions that occur from sources that are controlled or owned by an organization—and scope 2—indirect emissions associated with the purchase of electricity, steam, heat or cooling—greenhouse gas emissions by 30% by 2030. This is aligned with the Science Based Targets initiative (SBTIi )—a program to drive climate action in the private sector by enabling companies to set science-based emissions reduction targets—and the level of decarbonization required to meet the goals of the Paris Agreement.
• Circularity: 75% of Gildan’s packaging and trims specific to apparel SKUs will contain recycled or sustainable materials by 2027.
• Diversity, Equity and Inclusion: The achievement of gender parity by 2027 for Gildan’s employee group encompassing the director level and above.
What They Say:“Sustainability is a key pillar of our Gildan Sustainable Growth strategy, and this sustainability-linked facility is further evidence of our pledge to making meaningful advancements by 2030 in the areas of climate change; circularity; and diversity, equity and inclusion,” says Rhodri Harries, executive vice president, chief financial and administrative officer at Gildan.