Highlights

• Asda partners with Lloyds Bank to launch a new sustainability-linked finance scheme for UK suppliers.
• Suppliers achieving high sustainability scores via EcoVadis will benefit from preferential financing rates.
• The programme supports carbon reduction, ethical practices, and resilience across Asda’s supply chain.

Asda, the British supermarket and retailer, has introduced a new sustainable supply chain finance scheme in partnership with Lloyds Bank.

The aim is to use financial incentives to encourage suppliers to improve their sustainability performance.

Under this scheme, suppliers can access preferential financing rates that vary depending on how well they perform against specific sustainability Key Performance Indicators (KPIs).

Suppliers who perform strongly in areas such as carbon reduction, ethical standards, and social practices, and who also share their sustainability data, will be rewarded with the best financial terms.

To assess this, Asda has partnered with EcoVadis, a global sustainability ratings provider, which evaluates environmental, social, and ethical performance across supply chains.

Read More: The Benefits of EcoVadis Certification for Sustainable Businesses

This initiative builds on Asda’s earlier 2024 partnership with another bank, which introduced its first sustainability-linked supply chain finance programme. Both schemes use EcoVadis scoring to embed stronger sustainability practices, with a particular focus on decarbonisation and social initiatives.

According to Asda’s Chief Financial Officer, Michael Gleeson, the scheme is designed to reward progress and promote transparency across its supply base.

He explained that the approach strengthens Asda’s ESG goals and also creates a more resilient and responsible supply chain for the future. Lloyds Bank also noted that converting its existing programme into one that rewards sustainability will provide deeper support for British businesses and align with Asda’s ESG ambitions.

From October this year, suppliers that meet the criteria will be able to benefit from the scheme. Importantly, there will be no disruption for suppliers already in the programme. Those who do not participate will simply continue on their current payment terms and default rates.

Asda has already asked its largest suppliers, who account for around 80% of its product carbon emissions, to share data through EcoVadis, ensuring that the biggest environmental impacts are addressed first.

Ends/

Are you looking for green tech experts to scale your business? We are here to help with our extensive network of ESG and sustainability providers, offering a wide choice of services.

Follow KnowESG's Company news for regular news and views.

Check out our latest ESG Event updates

Source: Asda