84 - Sustainability-Linked Loans

Climate finance again

Financing the future 💰

What if your business could lower its borrowing costs by reducing carbon emissions or increasing workplace diversity?

Sustainability-linked loans (SLLs) are transforming the way businesses align their financing with ESG goals.

Unlike traditional green bonds that fund specific sustainability projects, SLLs are tied to a company’s overall performance in achieving pre-defined sustainability targets.

With the global SLL market surging, this financing model has become a critical tool for companies seeking to balance growth with responsibility.

But how do SLLs work?

A stacked area chart showing the cumulative issuance of sustainability-linked loans in USD billions from 2017 to 2022. The chart demonstrates steady growth, with significant acceleration in 2021 and 2022. Each year is represented in a different color, highlighting the increasing contribution of recent years to the total issuance. Data source: BloombergNEF.

Cumulative Issuance of Sustainability-Linked Loans (2017-2022)

Subscribe to keep reading

This content is free, but you must be subscribed to The Climate Mentor to continue reading.

I consent to receive newsletters via email. Sign Up Terms of Service.

Already a subscriber?Sign In.Not now

Reply

or to participate.