Safaricom, banks in Sh15b deal to drive sustainability plan
By Noel.Wandera, September 5, 2023
Safaricom Plc has inked a multi-billion-shilling sustainable linked loan (SLL) to strengthen its Environmental, Social and Governance (ESG) agenda.
The Sh15 billion deal, which is scalable to Sh20 billion, establishes the largest ESG-linked loan facility in East Africa and the first of its kind for Safaricom.
Peter Ndegwa (pictured), the telco’s CEO said the deal is a significant milestone for the company as it aligns with its sustainability agenda and a reflection of its commitment to transforming lives by partnering for growth. “In line with our focus to advance our sustainable business agenda, this funding will unlock our ability to create more diversified investments that will support transformative investments in new technologies, systems and services that allow us to comprehensively manage our ESG footprint,” he said.
Access funding
The funding is provided by a consortium of four banks including Standard Chartered, Standard Bank, Absa, and KCB. It will enable Safaricom to access funding based on its progressive achievement of set milestones across key ESG areas.
Standard Chartered Bank CEO Kariuki Ndegwa said the consortium deal was a significant milestone indicating the continued momentum towards building a more robust, sustainable and diversified financial ecosystem in the region.
“Across the market, we are seeing accelerated interest in sustainable finance products alongside more considered strategies for climate initiatives. We are enthusiastic about this partnership with Safaricom as it positions Kenya as a regional leader in inclusive and responsible investment,” he said. The SLL will help Safaricom deepen its focus on strategic sustainable investments as part of its ongoing transition to becoming a fully-fledged technology company by 2025.
Gender diversity
In particular, the company will focus on reducing its emissions to reach Net Zero targets, tracking gender diversity, and monitoring social equality impacts. The deal also paves the way for further sustainability financing in the region as companies seek to become more accountable for their ESG reporting and financing.