H&M and DBS join hands to promote fashion supply chain decarbonisation

H&M Group and DBS have joined hands to initiate a green loan programme that facilitates supply chain decarbonisation in the apparel sector.  

This comes as H&M Group has been engaged in climate mitigation for years and it continuously pushes itself to demonstrate climate leadership within the industry, according to Ulrika Leverenz, head of green investment, H&M Group. 

“We see that our industry is committed to tackling its negative climate impact. But we also see that impactful climate action requires collaborative financing. For us, sustainability investments are not only a responsible approach but a strategic necessity for future success,” Leverenz added. 

Through the programme, suppliers can gain access to financing from DBS and technical support from sustainability consultant, Guidehouse, to embark on factory upgrades to decrease their climate impact.  

Unlike traditional banking solutions which seek to encourage such green activities indirectly, this programme directly provides financing with highly favourable terms to suppliers for specific GHG emission reduction activities, as approved by H&M Group. 

“Accelerating net zero for supply chains requires the rapid scaling of low-carbon technologies and new, innovative financing models to drive adoption. The collaborative finance tool is a prime example of how we can create impact for suppliers,” said Tan Su Shan, group head of institutional banking, DBS. 

DBS is excited to be harnessing our extensive network in Asia, in partnership with H&M Group, to provide access to sustainable financing in a practical way – by directly funding factory upgrades to help suppliers improve their energy efficiency and decarbonise”, Tan added. 

MARKETING-INTERACTIVE has reached out to DBS for more information. 

Earlier this year, the collaborative finance tool completed the first successful transaction with a manufacturer in India to fund capital expenditures to reduce scope three greenhouse gas emissions.  

With the support of the loan, supplier Raj Woollen financed the installation of solar panels, energy-efficient motors, as well as water conservation technologies to conserve resources and reduce carbon emissions. 

“Raj Woollen is committed to its sustainability and environmental initiatives, and one key goal is to reduce the impact of our manufacturing processes on the environment. This joint project with H&M Group, Guidehouse, and DBS has been a successful combination of expert energy assessment, close support in selecting the most suitable technology solutions, and an attractive financing model,” said Sumeet Nath, managing partner, Raj Woollen Industries. 

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