CIMB’s landmark Sustainability-Linked Treasury Programme onboards first foreign MNC client, Intercontinental Specialty Fats

14 February 2023

The Programme incentivises clients to embed their ESG aspirations into thematic Treasury risk management solutions that are customised to their unique requirements

Kuala Lumpur: CIMB Bank Berhad (“CIMB” or “the Bank”) announced today that it has onboarded Intercontinental Specialty Fats Sdn. Bhd. (“ISF”) as the latest client in the Bank’s landmark Sustainability-Linked Treasury Programme (“the Programme”). ISF’s participation in the Programme is the first by a Japanese and foreign multi-national corporation (“MNC”) in Malaysia as it is a wholly-owned subsidiary of The Nisshin OilliO Group, Ltd. (“The Nisshin OilliO Group” or “the Group”), the largest processer and marketer of edible oils in Japan and one of the global leaders in the edible oil industry. 

Under the Programme, ISF stands to receive a rebate linked to the achievement of pre-agreed Sustainability Performance Targets (“SPTs”). SPTs are unique to each client’s business profile and sustainability aspirations, and are subjected to stringent independent third party verification.

ISF is the first client in the palm oil industry to have been onboarded after the Programme’s successful introduction in 2022. The Programme enables and incentivises clients to embed their environmental, social and governance (“ESG”) aspirations into Treasury risk management solutions that are customised to their requirements. In addition, the Programme provides for a longer term treasury solution by moving from one-off transactions towards a recurring business-as-usual flow programme framework.

Jefferi Hashim, Head, ESG Advisory and Solutions, Group Wholesale Banking of CIMB Group said, “CIMB is honoured to onboard ISF as a key partner in this innovative Programme, which will facilitate and support ISF’s sustainability goals whilst meeting their recurring hedging requirements over a longer-term horizon. This transaction highlights CIMB’s capabilities and commitment to help clients from a wide range of industries and sectors to advance their respective ESG agendas and create positive impacts through sustainable finance solutions. This is in line with CIMB Group’s ambition to become a leading focused ASEAN bank and ASEAN sustainability leader under our Forward23+ strategic plan."

Takashi Ishigami, CEO of ISF, said, “We thank CIMB for the support of this innovative Sustainability-Linked Treasury Programme. We see integrating Environmental, Social, and Governance (ESG) considerations into the corporate strategy is not just a moral obligation, but a way to create long-term positive value we have on our employee, stakeholders and ensure the sustainability of business success. Our commitment to the ESG mirrors our commitment to the people and to the world. Furthermore, the future of socially sustainable responsible finance is part of our sustainability goals."

The Nisshin OilliO Group was established in 1907, and today it has major operations in seven countries, including Malaysia, Singapore and Italy. The Group has been listed on the Tokyo Stock Exchange since June 1949, with a market capitalisation of over US$1 billion.

Having started their Sustainability journey in 2017, ISF is committed to sustainable production and responsible sourcing of palm oil. ISF’s raw materials are sourced responsibly in line with their No Deforestation, No Peat, and No Exploitation (“NDPE”) commitments. As a world leading palm specialty oils and fats manufacturer, ISF is driving a progressive, responsible business agenda range from responsible sourcing, human right, action on climate change, to making sure they adhere to the very highest standards in their production.

As a purpose-driven organisation and in line with its Forward23+ strategic plan, CIMB Group has been continuously stepping up its sustainability innovation. In recent years, CIMB has executed several notable sustainable finance transactions, including its landmark sustainability-linked derivative (“SLD”) transaction in October 2021, the world’s first Malaysian Ringgit denominated SLD transaction and Asia’s largest by notional value. Most recently, CIMB Group doubled its sustainable finance target to RM60 billion by 2024, having achieved its original target of RM30 billion two years ahead of schedule.