TREASURY4GOOD AWARDS
Best Sustainable Finance Project - BRONZE
Luxshare
A key supplier in the consumer electronics sector, Luxshare Precision Industry (Luxshare) is aligning its financing with its environmental goals, linking funding costs to progress in clean energy use and waste transformation. This approach is helping the company reduce its carbon footprint while improving financial efficiency.
Luxshare is dedicated to reinforcing its commitment to sustainability by embedding environmental targets into its financial strategy. With a commitment to achieving supply chain carbon neutrality by 2030, the company has gone beyond corporate pledges and made environmental progress a financial priority. And by transforming its receivables purchase programme into a sustainability-linked structure, Luxshare is proving that green goals and smart finance can go hand in hand.
Consumer electronics is an industry where supply chains are under increasing pressure to reduce their environmental impact. The company has long aligned its ESG approach with the United Nations Sustainable Development Goals (UN SDGs), but this latest move represents a fundamental shift, tying financial incentives directly to sustainability performance. Instead of treating ESG as an add-on, Luxshare has made it a core driver of its treasury strategy.
From targets to action
In Q3 2023, the business began discussions with banking partner Standard Chartered to introduce a financing agreement that links lending rates to environmental performance. By May 2024, this agreement was formalised, embedding sustainability-linked targets into Luxshare’s receivables financing.
The revised structure ties financing terms to two key environmental metrics: the proportion of clean electricity used and the percentage of waste that is recycled or repurposed. In turn, these KPIs align with the company’s long-term sustainability goals and the expectations of its customers and partners.
The first official measurement of Luxshare’s progress is expected in April or May 2025, assessing whether the company has met its sustainability-linked performance targets. Nevertheless, Luxshare has set milestones of reaching 40% clean electricity usage in 2024 and 50% by the end of 2025. Likewise, its waste transformation ratio target was 88% for 2024 and is expected to rise to 90% by 2025.
These commitments contribute to global sustainability efforts, particularly UN SDG 7 (Affordable and Clean Energy), SDG 12 (Responsible Consumption and Production), and SDG 13 (Climate Action). More importantly, they send a clear message that sustainability isn’t merely a corporate buzzword for Luxshare. Rather, it’s a business imperative. And by proactively embracing ESG, the company is strengthening its relationships with key partners and positioning itself as a leader in responsible manufacturing.
A portable framework
Instead of applying generic green finance labels, Luxshare’s model directly connects its sustainability efforts with financial outcomes. Meeting these targets enables the company to access more favourable financing rates, ensuring that its environmental progress delivers both operational and economic value. This approach also creates a framework that other businesses can follow, showing how financial strategy can support long-term sustainability goals in a practical, measurable way. By integrating environmental performance into treasury decisions, Luxshare is taking steps that will shape its industry’s approach to sustainable growth.
Looking ahead
As the company continues to expand its sustainability efforts, its approach to finance offers a clear example of how businesses can balance environmental responsibility with sound financial management. The steps taken today, in partnership with Standard Chartered, will help shape a more efficient and lower-carbon future for its operations and the wider supply chain.
By using financing as a tool for environmental impact, Luxshare is demonstrating that sustainability is both a corporate responsibility and a strategic advantage. As industries continue to evolve, businesses that integrate sustainability into their financial planning will be better positioned for long-term success.
