HSBC Bank USA and PVH Corp. announced that launch of the first sustainable supply chain finance program that is tied to both environmental and social objectives, and based on suppliers’ sustainability ratings.
The partnership with HSBC provides PVH’s suppliers with access to funding based on a set of science-based environmental targets, as well as a series of social elements, including a healthy and safe working environment, compensation and benefits, and employment issues, such as forced labor, child labor, and harassment and abuse.
According to recent research conducted by HSBC and Boston Consulting Group (BCG), global supply chains need $100 trillion of investment by 2050 if they are to achieve net zero emissions targets – and as much as half of this is required by small- and medium-sized enterprises (SMEs).
“We are proud to leverage our international and sustainability expertise to help one of the world’s largest apparel companies make progress against their ESG goals,” said Marissa Adams, Regional Head of Global Trade and Receivables Finance for HSBC North America,
“PVH’s commitment to environmental stewardship and enhancing human rights in our supply chain is core to our Forward Fashion strategy. The availability of accessible financing is pivotal to ensuring our suppliers are empowered to invest back into their businesses and people, and contribute to our collective goal of creating an innovative and responsible global supply chain,” said Sarah Clarke, PVH’s Chief Supply Chain Officer.
Suppliers progress will be measured against PVH’s Human Rights and Environmental Supply Chain standards and performance assessment standards will be measured using industry-aligned tools. These include the Social Labor Convergence Program (SLCP), which measures a facility’s performance against human rights and labor standards, and the Sustainable Apparel Coalition’s (SAC) Higg Facility Environmental Module, which assesses environmental standards. HSBC will act as a key financing partner in providing capital based on these trusted standards and building on the bank’s established expertise in sustainable supply chain finance programs that drive progress.
“With this announcement, HSBC continues to show their leadership in critically needed sustainable supply chain finance to fund the textile, apparel and footwear industry’s transition to net zero. We estimate the total cost for the decarbonization of this industry to be $1 trillion between now and 2050, the majority of which will go towards capital investment in the supply chain. We applaud HSBC, along with PVH, for forming this strategic partnership to finance clean production at apparel manufacturing facilities,” said Lewis Perkins, President of the Apparel Impact Institute.