GHG Emissions, Finance - August 25, 2022
Eaton Closes First Sustainability-Linked Bond
Power management company Eaton announced it closed an offering of sustainability-linked and senior notes.
Eaton’s sustainability-linked notes offering represents a step in aligning the company’s long-term financing structures with its environmental targets. The sustainability-linked notes interest rate is subject to the achievement of a Sustainability Performance Target (SPT) to achieve at least a 40% reduction in absolute Scope 1 and Scope 2 GHG emissions by year-end 2027, relative to a 2018 baseline.
“Achieving our sustainability goals is as critical to our business as meeting our financial commitments, and this financing aligns both strategies,” said Harold Jones, chief sustainability officer and executive vice president, Eaton Business System, Eaton in a statement. “Tackling climate change requires innovative solutions, and this offering will enable us to invest in energy efficiency, renewable energy and other emissions-reduction efforts.”
In 2020, Eaton announced its commitment to science-based targets to mitigate climate change. The targets were approved by the Science Based Target Initiative (SBTi) and include cutting carbon emissions from the company’s operations by 50% and reducing Scope 3 emissions by 15% by year-end 2030, relative to a 2018 baseline.
Eaton also established plans to invest $3 billion in research and development for sustainable solutions by 2030. Eaton published a Sustainability-Linked Bond Framework, and commissioned S&P Global Ratings to issue a Second Party Opinion (SPO) on the Framework’s alignment to the Sustainability-Linked Bond Principles (SLBP).