Coca-Cola Europacific Partners (CCEP), the world’s largest Coca-Cola bottler, announced the launch of a new sustainability-linked supply chain finance program, rewarding suppliers for improving their ESG performance, in collaboration with Netherlands-based Rabobank.
The new program will provide financing linked to a range of sustainability-driven KPIs for suppliers that, when met, unlock discounts against the initial funding rate. The KPIs will also help suppliers improve their overall ESG ratings via assessment from business sustainability ratings provider EcoVadis.
The initiative supports CCEP’s target of reaching net zero by 2040 and cutting greenhouse gas (GHG) emissions across its value chain by 30% by 2030, from a 2019 baseline.
According to CCEP, more than 90% of its emissions are attributed its supply chain and the company is already requesting that suppliers perform a series several emissions-reduction actions, including setting and validating targets with the Science Based Targets Initiative (SBTi) by 2023, committing to using 100% renewable electricity across their operations by 2023, and sharing their carbon footprint data.
Ralf Peters, Vice President Procurement, CCEP, said:
“We know how crucial it is that we work together with our suppliers to decarbonise our businesses, and are committed to providing the support and solutions they need to help them reduce emissions, aligned with our own sustainability goals. Our new supply chain finance programme is another important step that will help us to take collective action – by implementing positive and impactful change and driving continuous sustainability improvements.”
The program will initially launch in Germany and it is expected to expand to CCEP’s suppliers in rest of Europe, Australia and New Zealand. Rabobank is the primary financing bank for the program, with other banks expected to participate and grow the facility over time as it grows to an expected €600 million funding level.
CCEP said that it will also partner with Rabobank’s social impact fund, Rabo Foundation, supporting a farmer program in Indonesia promoting the adoption of sustainable practices and farm inputs to increase yields and achieve better long-term economic strength.
Thomas Levin, Managing Director Coverage at Rabobank, said:
“Coming up with solutions to help businesses achieve their sustainability targets runs to the heart of all of our financing initiatives and Growing a Better World Together strategy.”