BALFOUR Beatty has announced the firm has reached agreement for the conversion of its £375 million revolving credit facility (RCF) to the ‘largest sustainability linked loan’ in the UK construction industry to date, extending the maturity to October 2024.
Under the terms of the loan, the group revealed it is incentivised to deliver annual measurable performance improvement in three ‘key’ areas: carbon emissions, social value generation, and an independent Environmental, Social and Governance (ESG) rating score as determined by Sustainalytics, an ESG research, ratings and data provider.
Performance in these three areas will be monitored and – depending on the outcomes achieved – a credit margin reduction or increase will be applicable.
Phil Harrison, Balfour Beatty chief financial officer, said, “Balfour Beatty has long been at the forefront of sustainability in the construction sector, with clear targets and ambitions as set out in the company’s Group Sustainability Strategy. We are delighted to further demonstrate our commitment with this new sustainability linked loan. We appreciate the support of our international bank group and the confidence this commitment reflects in Balfour Beatty.”
Max Jones, infrastructure and construction director, Lloyds Bank, added, “We’re proud to have worked with Balfour Beatty’s international bank group to fund and co-ordinate the largest sustainability linked loan in the UK construction industry. With the sector’s drive to becoming more sustainable, critical to the UK’s net zero ambition, this is an important development for the industry as a whole. Acting as the sole Sustainability Coordinator and the Facility Agent signals our commitment to the industry and our support for Balfour Beatty to reach its ESG goals.”