Gildan Activewear has amended and restated its $1 billion, 5-year revolving credit facility to incorporate sustainability-linked terms that adjust the borrowing costs based on the company’s performance on ESG goals.

The amendment introduces an annual pricing adjustment based on the achievement of three of Gildan’s Next Generation ESG targets, which were communicated at the beginning of this year. Gildan is the first Canadian apparel manufacturing company to tie financing costs to the achievement of ESG targets.

“Sustainability is a key pillar of our Gildan Sustainable Growth strategy, and this sustainability-linked facility is further evidence of our pledge to making meaningful advancements by 2030 in the areas of climate change, circularity, diversity, equity, and inclusion,” said Rhodri Harries, executive vice president, chief financial and administrative officer at Gildan.

Sustainability-Linked Revolving Credit Facility
The amended and restated $ 1 billion 5-year revolving credit facility includes terms that reduce or increase the borrowing costs based on the Company’s annual performance against the following three recently announced ESG targets:

  • The reduction of Gildan’s Scope 1 and Scope 2 GHG emissions by 30 percent by 20301, in alignment with the SBTi and the level of decarbonization required to meet the goals of the Paris Agreement;
  • 75 percent of Gildan’s packaging and trims, specific to apparel SKUs, will contain recycled or sustainable materials by 2027; AND
  • The achievement of gender parity by 2027 for Gildan’s employee group encompassing the director level and above.

BMO Financial Group is acting as the Lead Sustainability Structuring Agent. TD Financial Group and CIBC Financial Group are acting as co-lead sustainability structuring agents for Gildan’s sustainability-linked loan.