Royal DSM: Credit Facilities
Royal DSM is a global science-based company active in nutrition, health and sustainable living. A commitment to sustainability is one of its core values, a key business responsibility and an important business growth driver.
“Royal DSM is deeply committed to providing products and solutions that help to combat climate change. Therefore, I am pleased that our long-term banking partners have supported us in getting this innovative financing arrangement in place, underscoring the importance of sustainability in everything we do and that includes corporate finance.”
Geraldine Matchett, CFO and member of the DSM Managing Board
Key facts
| €1 billion revolving credit facility |
| Five year term |
| Interest linked to GHG reductions |
WHAT?
To underline Royal DSM’s commitment to tackling climate change, it has launched a new €1 billion revolving credit facility which links the interest rate to greenhouse gas (GHG) emission reduction.
WHY?
Understanding and being responsive to sustainability issues is a key driver of Royal DSM’s success. The company sees this as a key competency throughout the organization, including the treasury function. Linking the revolving credit facility to sustainability performance helps to keep Royal DSM’s commitment to sustainability at the centre of its treasury activities. Integrating sustainability and financing is helping to realize Royal DSM’s sustainable ‘Strategy 2021: Growth & Value – Purpose led, Performance driven’.
HOW?
Royal DSM worked with a syndicate of 15 long-term banking partners to develop the facility, which links the interest rate to corporate performance in reducing GHG emissions, by using three key performance indicators:
- GHG efficiency improvement
- Energy Efficiency Index (EEI) improvement
- Increasing the percentage of electricity sourced from renewable resources
The €1 billion revolving credit facility underpins Royal DSM’s strong liquidity profile, and is intended for general business purposes. The Facility has a maturity of five years, which may be extended by a further two years.
