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    • General Sustainability

HSBC Green Link | Walmart, a Green Leader at Renewables

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Businesses must now take proactive measures in support of China’s decarbonisation strategy for sustainable development and high-quality growth. Stay tuned for “HSBC Green Link” series on real-life “green stories” of businesses across sectors.

On 22 September 2020, China officially announced its decarbonisation goals for 2030 (carbon peak) and 2060 (carbon neutrality), inaugurating the country’s low-carbon era. As a result, businesses across all sectors began to develop their own timetables and roadmaps for carbon neutrality to accelerate their green transition towards a net-zero future.

For some businesses, “green and low-carbon” represents a new arena. For others, it has long been part of their DNA.

Walmart, for example, has been embedding sustainability within its corporate strategy since 2005. In 2005, the retail giant announced its first set of sustainability goals including commitments to renewable energy, waste, and product sustainability.

In 2020, Walmart followed those initial goals with a science-based target for its emissions: to achieve zero emissions across its operations globally by 2040. Furthermore, the company committed to pursue becoming a regenerative company that places nature and humanity at the center of its business. Alongside that ambition, Walmart has set goals to protect, restore, or more sustainably manage at least fifty million acres of land and one million square miles of ocean with the Walmart Foundation, reduce or avoid one billion metric tons of emissions from its global supply chain in partnership with its suppliers (in an initiative called “Project Gigaton™”), and achieve zero waste in key markets by 2025.

Walmart upgraded to energy-saving freezers in hypermarket for carbon reduction

Since 2019, HSBC has been supporting Walmart’s Sustainable Supply Chain Finance (SSCF) programme, which offers improved financing to eligible suppliers if they reduce greenhouse gas (GHG) emissions in at least one of the six pillars of Project Gigaton™.

In 2021, together with Walmart’s global sourcing team, HSBC updated the company’s SSCF programme – under which suppliers taking part in Project Gigaton™ now have the option for setting science-based targets and having their targets validated by the Science Based Targets Initiative (SBTi), or achieving certain score thresholds on their CDP climate change reports.

In 1996, Walmart made its debut in China by opening a hypermarket and Sam's Club in Shenzhen. 26 years on, it has developed sustainability targets for its operations in the country. The retailer plans to achieve a further 25% reduction in carbon intensity for its operating entities including hypermarkets, Sam's Clubs and distribution centres in China by 2025, down 70% from 2005.

A Sam’s Club in Shanghai using rooftop solar-power system

In June 2021, HSBC China began offering Green Deposits to institutional and corporate customers as the first international bank to do so in mainland China – a programme anchored in shared commitment to sustainability. Among the first batch of participants in the programme was Walmart China.

As China’s decarbonisation process continues unabated, more and more businesses are shifting towards a green and low-carbon development model. Our Green Deposits offering not only allows companies to plan for inclusion of sustainability agendas into their treasury activities, but also helps drive more financial flows into environmentally beneficial projects in need.

Eddie Ching | Senior Executive Vice President and Deputy Chief Executive Officer of HSBC China.

HSBC’s Green Deposits programme can support the bank’s corporate customers to invest their surplus cash balances through customer lending into eligible green projects and initiatives under themes including renewable energy, energy efficiency, pollution prevention and control, green buildings, clean transportation, sustainable water and wastewater management. HSBC China also provides customers with a periodic ‘Green Deposits Report’ on the allocation of funds. With all these elements, the programme comes as a perfect fit for Walmart's needs.

According to HSBC China, eligible environmental projects and businesses are aligned to the HSBC Green Bond Framework and Green Loan Principles that apply to HSBC entities globally. The raised funds will be used to promote the transition to a low-carbon, climate-resilient and sustainable economy, and provide clear environmental sustainability benefits while mitigating environmental and/or social risks.

For each customer of the programme, HSBC China will issue a ‘Green Deposits Certificate’ based on the deposit amount and tenor as a proof of the customer's support for environmental projects and sustainability initiatives. Moreover, a ‘Green Deposits Report’ with statistical details will also be issued quarterly to demonstrate that all deposits raised under the programme have been allocated to finance sustainable projects. With these credentials, customers are able to document their sustainability efforts under HSBC Green Deposits.

As of May 2022, close to 50 companies and corporate groups have signed on to HSBC China's Green Deposits programme, with a total deposit of RMB2.5 billion. According to Eddie, HSBC is exploring through constant innovations to provide a diverse suite of green banking solutions for corporate sustainability of its customers. “Going forward, we’ll continue to work with businesses in contributing to China’s sustainable economic development.”

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