Borrowing costs

Gildan links borrowing costs to sustainability goals

When it comes to sustainability, Gildan puts its money where it says its values ​​are.

The Top 40 supplier of promotional products, also one of the world’s largest makers of basic apparel, has signed an amended and updated $1 billion five-year revolving credit facility that includes terms that reduce or increase borrowing costs based on the Montreal-based company’s performance against three important goals of its corporate environmental, social and governance (ESG) plan.

Gildan said it was the first Canadian apparel company to tie financing costs to achieving ESG goals.

Borrowing costs will decrease if Gildan meets targets such as reducing its Scope 1 and Scope 2 GHG emissions by 30% by 2030, in line with the Science Based Targets initiative (which drives climate action in the private sector) and the level of decarbonization required to achieve the goals of the Paris Agreement.

Another goal against which Gildan will be measured is to ensure that 75% of its clothing SKU-specific packaging and trimmings contain recycled or sustainable materials by 2027. The third benchmark goal is to achieve gender parity. women by 2027 in management positions and above.

“This sustainability-related facility is further proof of our commitment to making meaningful progress by 2030 on climate change, circularity, diversity, equity and inclusion,” said said Rhodri Harries, Executive Vice President/Chief Financial and Administrative Officer at Gildan. .

In January 2022, Gildan launched its next generation ESG, which guides sustainability and corporate social responsibility initiatives over the next eight years.

In March, Gildan announced it would create an anthem film and documentary series as part of a new marketing and communications campaign, “Gildan Respects”, which aims to share compelling stories and achievements from the ESG Next plan. Generation of the supplier.

Based on estimated revenues of $413.1 million from promotional products in North America in 2020, Gildan ranked sixth on Counselor’s most recent list of the industry’s largest vendors.

Regarding the credit facility agreement, Gildan noted that BMO Financial Group is acting as the lead sustainability structuring agent, while TD Financial Group and CIBC Financial are the co-lead sustainability structuring agents. for the sustainability-linked loan.

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