Savings from Macquarie University's SLL will be reinvested in scholarships
In an innovative application of sustainable finance, Macquarie University, with the support of Commonwealth Bank, will reinvest the margin adjustments from its inaugural sustainability-linked loan (SLL) in scholarships for disadvantaged students.
Macquarie has become one of the first universities in Australia to establish an SLL, as part of refinancing $450 million of bank facilities, with CBA acting as sustainability coordinator.
SLLs incentivise borrowers to achieve pre-agreed social and environmental key performance indicators (KPIs). In the case of Macquarie, its KPIs include reducing Scope 1, 2, and 3 emissions, improving biodiversity, Indigenous cultural safety, and awareness of UN Sustainability Development Goals, gender equality, and widening participation in STEM (science, technology, engineering, and mathematics) for underrepresented groups.
“Commonwealth Bank is proud to support Macquarie University not only with its first sustainability-linked loan, but also with the commitment to reinvest any savings in scholarships for disadvantaged students,” said Deborah Leerhsen (pictured above), executive general manager of global client solutions at CBA. “This innovative application of sustainable finance to better serve the communities in which we operate resonates with CBA’s purpose, to build a brighter future for all.”
S Bruce Dowton, vice-chancellor at Macquarie University, said the SLL adds to the university’s efforts to make meaningful progress on the issue of sustainability.
“To have six KPIs in one transaction is a significant achievement and reflects the diversity and sophistication of the University’s commitment to the United Nations Sustainable Development Goals,” Dowton said. “The ambitious targets reinforce our work to advance sustainability across our operations, research, curriculum and environment.”
Charles Davis, managing director of sustainable finance and ESG at CBA, said the university sector has been a leader in environmental and social infrastructure design and comprehensive sustainability strategies, as well as pioneered the adoption of sustainable finance solutions prior to the pandemic.
“Macquarie University was one of the first institutions in the country to issue in Australia’s ESG bond market, and this sustainability-linked loan continues its track record of innovation and commitment to sustainability,” Davis said. “As we look to the future, we expect to see an increasing focus from universities on embedding their ambitious sustainability targets within emerging sustainability borrowing frameworks such as Macquarie University’s inaugural $450m sustainability-linked loan.”
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