The Co-op, in a first for a UK retailer, has issued a sterling denominated Sustainability Bond. It has raised £300m and the society plans to allocate the proceeds to its work on supporting and promoting Fairtrade, including Fairtrade producers and their communities.
The group stated that the move underlines its unique focus on a “better way of doing business which delivers real benefits for members, communities and investors”.
The Co-op’s leadership on Fairtrade comes as some other major retailers are scaling back their investment, a key source of support for communities around the developing world.
The society intends to allocate the net proceeds of the Sustainability Bond issuance to the costs of bringing Fairtrade products to customers, marketing and promoting Fairtrade products and wider Fairtrade movement.
The five-year Sustainability bond pays investors an annual interest of 5.125%. Raising funds through a Sustainability Bond allows the Co-op to access long-term funding at an attractive rate and enables global investors to increase their focus on investments that meet the UN’s Sustainable Development Goals and key environmental and sustainability targets.
Commenting on the bond, Steve Murrells, CEO of the Co-op, said: “The popularity of this bond demonstrates confidence in the Co-op’s growth strategy and in particular how we’ve placed sustainability at the heart of our future plans.
“Co-op was an early pioneer of Fairtrade and now with the support of like-minded investors we can grow it further, opening up new opportunities and creating value for our members as well as producers and communities in developing countries.”
