Citi launches sustainability-linked SCF for Asia Pacific
Citi announced the launch of its first sustainability-linked supply chain finance (SSCF) program in Asia Pacific to support clients in advancing their ESG priorities, improve the resilience of their supply chains and manage their working capital needs.
Supply chain finance (SCF) programs benefit companies and their suppliers as they prioritise their working capital positions respectively, said the bank. For those using Citi’s SCF program, for example, the bank would provide financing to a client’s suppliers from the date of collection of specific goods/provision of services to the date on which payment is owed to these suppliers. The cost of this financing is borne by suppliers at a rate lower than their usual cost of funds. As a result, suppliers benefit from cash flow acceleration, quicker payment and improved financing costs.
Citi’s first SSCF program has been implemented for German chemical and consumer goods company, Henkel. The program was first launched with suppliers in Australia and will be expanded to include suppliers in additional markets over the coming weeks.
The program is also a first for Henkel in Asia Pacific and is targeted at existing or new suppliers who demonstrate strong or improving sustainability performance. Qualifying suppliers can access Citi’s SCF at preferential rates on a tiered basis with rates improving as a supplier’s sustainability score improves. Henkel, with the support of a global leading sustainability assessment agency, will assess the sustainability performance of suppliers.
“Sustainability is at the heart of Henkel’s strategic priorities. We are convinced that sustainability-linked supply chain financing can help improve sustainability across Henkel’s large supplier ecosystem in Asia Pacific,” said Christoph Wenner, Henkel Regional Head of Finance, Asia Pacific. “This program demonstrates Henkel’s commitment to creating a virtuous cycle of economic, environmental and social value.”
Citi’s added that its Apac SSCF program aligns with the bank’s ESG commitments. To help accelerate the transition to a global low-carbon economy, Citi launched its updated Sustainable Progress Strategy in July.
“We are proud to be collaborating with Henkel in this first for Citi in Asia Pacific. Like Henkel, our ESG commitments are an essential part of our firm’s strategy and these commitments are deeply integrated into our business and long-term priorities,” said Ernesto Pittaluga, Asia Pacific Corporate, Commercial and Public Sector Sales Head, Treasury and Trade Solutions, Citi.
EIB calls time on oil and gas loans
The European Investment Bank (EIB) has announced that it is ending all loans to oil and gas companies. The bank said it wants to align its projects and operations with the goals of the Paris Agreement, and can no longer support corporations who continue to invest in high carbon activities.
At the same time, the EIB is to triple climate adaptive finance for businesses in order to ramp up regional efforts for a greener economy. The EIB’s Adaptation Plan supports the objectives of the European Union Adaptation Strategy for both inside and outside the EU. Before finance can be obtained, all business projects will now be screened for risks of climate change and its ability to adapt to future changes.
“As one of the leading multilateral banks for climate action, we are further increasing our climate ambition. In general, EIB will no longer finance standard low-carbon projects of high-emitting corporations if the corporation continues to operate or invest in activities that are not aligned with the goals of the Paris agreement” said EIB President, Werner Hoyer.
“We listened to the calls from the COP26 Presidency and the international community on how public banks must do more to help save the planet from global warming. We stand ready to work with our partners to increase our joint impact, and respond to the calls from the COP26 Presidency and international community.”
ION introduces TreasuraSpark for cash management
ION Treasury has launched TreasuraSpark, described as a simple to use cash management SaaS solution, to help high-growth organisations migrate from outdated spreadsheets to automated cash management.
In its press release, ION said that TreasuraSpark provides a real-time view of an organisation’s available and expected cash balances. By automating the collection and reconciliation of cash movements, companies gain confidence that they have a sufficient level of cash to cover daily needs. This visibility leads to cost reductions including the opportunity cost associated with excess cash, cost related to overdraft facilities, and time saved by removing manual processes and fixing errors.
TreasuraSpark delivers automation and controls to companies requiring more frequent updates to cash activity and balances but find the experience of creating their cash view cumbersome.
An easy, self-guided setup enables organisations to simply sign up online, and establish connections to their banks for automated flow of cash balances and transactions in one location. With secured bank connectivity, TreasuraSpark collects, consolidates, and stores banking data with a full audit trail.
For companies seeking cost-effective alternatives to spreadsheets, TreasuraSpark delivers quickly without IT resource expenditure or implementation costs. The solution automates daily cash processes that every finance team must manage and is ideally suited for managing cash-related activities, with cost-effective routes to streamline and simplify basic cash processes.
“As many in the industry continue to operate with legacy systems and look to improve automation, ION seeks to ensure that organisations can avoid manual processes and have the visibility to cash they need to manage working capital,” said ION Corporates CEO Richard Grossi.
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