Westpac NZ and Contact Energy (ASX:CEN) have entered into a $50 million, four-year sustainability linked loan facility. The loan is the first of its kind in New Zealand.
Contact Energy will be incentivized by a discounted interest rate on the sustainability-linked loan if it meets ambitious targets linked to its environmental, social and governance (ESG) rating.
Conversely, Contact will pay higher interest costs if it doesn’t meet the rating targets agreed with Westpac.
Westpac NZ’s Head of Sustainable Finance, Joanna Silver, says the loan is a good example of businesses working together to drive better environmental and social outcomes, and enhanced corporate governance.
Shares in Contact Energy (ASX:CEN) closed 4.2 per cent higher yesterday at $7.26.