Pāmu and Westpac NZ agree to market-leading sustainability loan

Westpac NZ and Pāmu signed New Zealand’s most comprehensive sustainability loan to date, also the largest in agriculture, and the first involving a state-owned company.

Pāmu, also known as Landcorp, is New Zealand’s largest farming company. It will borrow $ 85 million from Westpac NZ over three years. To incentivize continuous improvement in sustainability performance, Pāmu will receive a price discount from Westpac NZ if it achieves significant and ambitious performance targets and will pay higher interest charges if it achieves significant and ambitious performance targets. does not reach them.

This is the first loan linked to sustainability in the agriculture sector to include a science-based 1.5 degree emission reduction target that will be validated against global best practices.

Pāmu has a national portfolio of 114 farms that produce milk, beef, lamb, wool, game, timber and other natural products for large processors and niche markets around the world. Lisa Martin, Managing Director of Sustainability and Farming Systems at Pāmu, says sustainable agriculture is at the heart of Pāmu’s business approach.

“We work hard to cultivate in a way that improves and enriches the natural environment and the lands we cultivate, and sustainability and innovation are essential to ensure ‘fit’ farming systems,” says Ms. Martin.

“This leading loan linked to sustainable development is another step in our journey towards the constant improvement of the stewardship of our farms. This constitutes a real incentive for the company to continue to rely on the agricultural performance plans that we have already put in place in our network of farms and provides broad objectives in the perspectives of sustainability, the environment, good -being people and animals.

Pāmu CEO Steven Carden said Pāmu has a leadership role to play in the industry.

“We are truly delighted to be part of New Zealand’s most comprehensive sustainability loan to date. We see this as another way to use our size, scale and diversity to lead an initiative like this for the agriculture sector.

“We anticipate that these types of sustainability metrics will become the norm for most commercial lending in the future, so our partnership with Westpac aims to strengthen the ability to regularly measure and report on the progress we make to improve our performance. when it comes to sustainability. “

The incentive pricing of the loan aims to encourage farmers in Pāmu to improve all aspects of agricultural sustainability. It describes the annual steps to reduce all levels of greenhouse gas emissions throughout the company’s value chain.

By integrating Toitū Envirocare’s new agricultural certification program throughout the life of the loan, Pāmu farms will be able to credibly measure, manage, verify and reduce their greenhouse gas emissions.

The loan encourages Pāmu to roll out a comprehensive “Sustainable Farm Performance Program” in Pāmu farms. This will help inform the priorities of integrated business plans and complement and support workflows in key areas such as animal health, welfare and nutrition; environment, as well as people, culture and community, adaptation and mitigation of climate change.

The agreement also includes a commitment to improve health, wellness and safety performance year by year, as well as the implementation of targeted mental health initiatives for Pāmu teams to the farm.

Westpac NZ Head of Sustainable Finance Joanna Silver says this loan is an important benchmark for sustainability lending.

“By having an independently validated target aligned with the Paris Agreement and committing to reductions covering all emission ranges, Pāmu is truly raising the bar for climate ambition in the agricultural sector. Said Ms. Silver.

“Kiwifruit farmers and growers have an important role to play in supporting Aotearoa’s transition to a resilient, net zero economy for the benefit of all. Sustainability on the farm is essential for New Zealand as we look to the future, and helping our rural communities to ensure their well-being is really important, so we are happy that Pāmu is committed to achieving goals. sustainability issues and to provide mental health training to all Pāmu farms. managers.

“Sustainability loans are a great example of like-minded organizations working together on projects that will bring real benefits to their employees, customers, our environment and our communities.

“As a major lender with the goal of enabling $ 10 billion in sustainable financing by 2025, we are excited to be working on this broad structure with Pāmu and look forward to helping more organizations achieve their ambitious goals. sustainability performance across their business. “

Westpac and Pāmu also thanked EY for providing assurance services on the objectives of the loan to ensure it meets international principles and standards.

Pāmu Sustainability Loan Objective Details:

Sustainability ambition Detail
Verification and achievement of a scientific target to reduce greenhouse gas emissions in line with global targets

Pāmu will set a science-based decarbonization target aligned with the scale of reduction required to keep the global temperature rise 1.5 ° C above pre-industrial temperatures. The target will be validated by the Science-Based Targets initiative (SBTi *) (or a credible verifier confirming alignment with the SBTi methodology).

Pāmu will implement an emissions reduction plan to meet the target and aim for interim annual emission reduction targets until June 2024, as outlined in the sustainability loan.

Pāmu is committed to reducing greenhouse gas emissions from all emission scopes (being Scope 1, 2 & 3 emissions) in accordance with the Emissions Reduction Plan, and to a minimum of at least 4 % per year.

Toitū agricultural certification program across the farm portfolio

Pāmu is committed to ensuring that its farms achieve the Toitū Farm Certification Program, which is spanned over 3 years. This is New Zealand’s first carbon reduction certificate designed specifically for farms. Additionally, all Pāmu farms will have documented emission reduction targets and decarbonization plans by 2024.

Improve sustainability performance on the farm

Pāmu will implement a phased assessment of its tailor-made “Sustainable Farm Performance Program” in all Pāmu farms by 2024. This is a comprehensive sustainability improvement program designed by Pāmu to assess farm performance against material durability measures and recommend durability improvements.

Improve employee well-being

Pāmu aims to make year-to-year improvements in health, wellness and safety through continuous safety assessment, as well as leading and implementing targeted initiatives in mental health. By 2024, Pāmu aims for a reduction of at least 26% of injuries to reduce the
Lost Time Injury Frequency Rate to 6.9. Pāmu is also committed to providing mental health training to 100% of all farm managers and more than double the current amount of mental health training for farm staff.

About SBTi

The Science Based Targets initiative is a global partnership that offers a clearly defined path to reduce emissions in line with the goals of the Paris Agreement. SBTi independently assesses and approves companies’ emission reduction targets in accordance with its strict criteria. 13 New Zealand companies have set science-based emission reduction targets that have been validated by SBTi.

About Pamu

Pāmu is the brand name of Landcorp, a state-owned enterprise and one of New Zealand’s most innovative agriculture and food companies. It is also the name given to the quality products created by the company. Pāmu is the Maori word, “close” and reflects the deep connection New Zealanders have with the land, born out of respect and a genuine desire to protect and improve the environments in which the company operates. It is a proud provenance that is hidden behind every product bearing the Pāmu name.

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