Musim Mas is proud to announce its first sustainability-related credit line, which is an important step in its pursuit of sustainable business. In collaboration with Rabobank as Sustainability Coordinator and HSBC as another lender, the marketing arm of Musim Mas Group, Inter-Continental Oils & Fats Pte. Ltd. Both its Spanish and Italian biofuels businesses are converting a 150 million euro perpetual revolving credit facility (RCF) into a loan linked to sustainable development.

Musim Mas strategically uses credit related to sustainable development (SLL) to seamlessly integrate environmental and social sustainability into its financial system. In this way, the company strengthens its commitment to corporate responsibility in accordance with the principles of the LMA in relation to loans related to sustainable development. The credit related to sustainable development is based on three key performance indicators (KPIs) – RSPO certification of independent small farmers, training of independent small farmers, and maintaining a deforestation-free palm oil supply chain. The external review of Musim Mas’ annual progress is conducted by reputable experts, which ensures transparency and accountability.

These key indicators have been carefully selected taking into account various factors, such as the materiality and ambition of the tasks set. Independent small-scale palm oil farmers on small plantations provide an important opportunity to promote sustainable palm oil production. In order to sustainably increase the total output of independent small farmers, who account for approximately 41% of the production area, it is necessary to increase their yields. By enabling these small farmers to adopt sustainable farming practices, Musim Mas not only improves their living conditions and promotes social justice, but also moves towards its long-term goals of eliminating deforestation and promoting a sustainable and responsible palm oil production chain.

As the fund’s coordinator in the field of sustainable development, Rabobank contributed to the implementation of the principles of sustainable development in the financing structure. Rabobank and HSBC act as joint creditors of the fund.

Gregory Vandeleur, Head of Trade and Commodities Finance at Rabobank Asia, explains: “Rabobank is honored that Musim Mas is serving as the chief sustainability coordinator for their first sustainability-related loan. Musim Mas is one of our long-standing customers and a true leader in sustainable development in the palm oil industry. The cooperation within the framework of this first transaction reflects our trusting relationship with them. Linking sustainability indicators with financing is a way to support our clients in fulfilling their sustainability promises, while improving farmers’ productivity, resilience and standard of living. There is a huge potential to increase the sustainability of the agri-food sector. As a leading raw materials bank in the food, agriculture and trade sectors, we want to play a leading role in working closely with our customers on their way to a sustainable transition.”

Priya Kini, head of HSBC’s commercial banking division in Singapore, said: “We have a long-standing relationship with Musim Mas, and we are pleased to be able to provide support in obtaining the first loan related to sustainable development. Musim Mas wants to implement ESG principles into their important business and financial activities, and we are happy to help them do this. This partnership is a clear testament to HSBC’s ongoing efforts to support our customers’ transition to a more sustainable future.”

This loan related to sustainable development marks a new step in Musim Mas’s commitment to integrate environmental and social aspects into its financial activities. In 2021, the company entered into an agreement on financing environmentally friendly trade with a bank in Singapore. At that time, RSPO certification was the main performance indicator under the Green and Sustainable Trade Finance and Working Capital program The Task Force on the Green Finance Industry of the Monetary and Financial Authority of Singapore (MAS). In 2024, Musim Mas, in partnership with a leading bank, introduced an innovative sustainable account related to the liquidity management structure. This initiative is aimed at optimizing cash flows and working capital for all enterprises of the group, while organically combining environmental, social and managerial aspects.

“Obtaining a loan related to sustainable development, with ambitious, meaningful and measurable goals, is a testament to Musim Mas’ deep commitment to promoting sustainable development and responsible business conduct. Musim Mas makes it clear to our stakeholders, such as financial banks, customers and employees, that we strive to have a positive impact on the environment and society while creating long-term value,” said Mr. Alvin Lim, Chief Financial Officer and CEO of Musim Mas.