EY has today announced that it has secured an Environmental, Social and Governance linked Revolving Credit Facility (ESG-linked RCF) in the UK, as part of its commitment to accelerating progress on carbon reduction, diversity and social mobility.
The new facility, the first of its kind in the UK secured by a member of the Big Four accountancy firms, is linked to three ESG targets. EY’s performance against these metrics will be verified annually by external auditors and will determine the interest rate applicable under the RCF – which can go both up or down.
35% reduction in EY’s air travel emissions by 2025
In addition to EY achieving its carbon negative status globally earlier this year, the UK firm has set a target to reduce its air travel emissions by 35% by 2025. To help achieve this reduction, the firm continues to develop employee guidance to reduce the environmental impacts of travel and encourages people to travel smarter through better journey planning and increased utilisation of flexible working practices and remote working technologies.
Grow the number of EY volunteers in the EY Ripples programme by 75% to 2025
EY Ripples is the firm’s global corporate responsibility programme. The programme aims to mobilise EY people and networks, making the most of their unique skills and knowledge, to have an impact on the wider community. To support the programme, the firm has set a target of increasing the number of EY volunteers by 75% to 2025. Over the last financial year EY Ripples contributed to a range of projects that positively impacted almost 1.3m people in the UK. As well as community projects, the programme supports the next generation workforce by promoting social mobility.
New Partner admissions to be 40% female & 20% underrepresented minorities by July 2025
Creating a diverse and inclusive workforce continues to be a top priority for EY, both at a Partner level and across the UK firm. In 2019, EY set ambitious targets to double the proportion of female and ethnic minority partners in its UK business to 40% female and 20% from ethnic minority backgrounds by July 2025, as part of the firm's strategy to accelerate its progress on diversity and inclusiveness. In 2020, EY went one step further, by setting a series of new anti-racism commitments which included an additional target for 15% of EY’s ethnic minority Partners to be Black by 2025. Of the new Partner appointments this year, 32% are women and 18% are from ethnic minority backgrounds, including one Black Partner.
The size of the ESG-linked RCF has not been publicly disclosed by EY but has been signed with three banks – Lloyds Bank plc (ESG Coordinator), HSBC Bank plc, and Santander UK plc (with Banco Santander, S.A., London Branch as Facility Agent).
Hywel Ball, EY UK Chair, comments: “Today’s announcement is a further commitment from EY to tackling climate change, inequality and building sustainable, purpose-led growth. Achieving our environmental, social responsibility and diversity goals are key to the success of our business and have the potential to make a significant impact to the communities that we operate in. We’re determined to accelerate the pace of change and the new ESG-linked RCF will help to support our progress by holding the business to account and linking our targets to clear commercial outcomes.”
Greg McDermott, Relationship Director, Services, Lloyds Bank Commercial Banking, says: “We applaud EY for the foresight and recognition that the time to act on sustainability is now, not tomorrow. Completing the inaugural sustainability-linked loan within the accountancy sector is a measure of its leadership as a business advisory firm whose work touches every part of the UK economy. We’re proud of the role we’ve played in this first-of-its-kind funding and look forward to supporting EY on its sustainability journey.”
Sneha Patel, Relationship Manager, HSBC, comments: “HSBC is delighted to have supported EY in its first ESG-linked RCF. Sustainable financing forms a critical part of the wider sustainability strategy of both HSBC and EY and collaboration on this facility demonstrates our respective commitments to those strategies and our responsibilities in this area.”
Nicholas Bailey, Relationship Director, Santander UK said: “Santander UK is delighted to support EY with this landmark ESG financing. EY’s commitment to achieving its environmental, social responsibility and diversity goals is clear and it is leading the way by adopting this type of financing, which we anticipate will become increasingly popular with corporate clients.”