Nokian Tyres plc has signed a sustainability linked loan agreement with the OP Corporate Bank. The EUR 100 million five-year loan is used for paying off a similar sized loan which is due in May.
Sustainable financing is trending rapidly around the world, and Finnish companies are showing increasing interest towards these types of loan agreements. Financing that is linked to sustainability goals is a way for companies to match their finance strategies even more closely together with corporate sustainability. This makes the goals of corporate sustainability more concrete.
The margin of the loan will increase or decrease dependent on Nokian Tyres meeting three sustainability key performance indicators: 1. Commitment to the indicators defined according to the Science Based Targets initiative, which has been created to lower greenhouse gas emissions.
2. Auditing the human and labor rights in natural rubber processing plants.
3. Reducing workplace accidents.
”All three areas require more steps forward. Reaching our targets means continuous improvement”, says Nokian Tyres VP, Quality & Sustainability Teppo Huovila.
Concrete targets linked to financing also help the financiers to have a meaningful discussion on sustainability and supporting the progress of these targets together with clients.
"The loan agreement of Nokian Tyres is an example of the way the bank and the company can together support the advancement of the sustainability goals. As a financier the banking sector has an essential role in advancing sustainable finance, and OP Corporate Bank is actively involved in supporting its customers in reaching their sustainability targets”, says Katja Keitaanniemi, President and CEO of OP Corporate Bank.