Unpacking Smurfit Kappa’s Ambitious Sustainable Finance Facility

By setting five key performance indicator goals for a recent sustainability-linked revolving credit facility – and requiring success in all of them to gain the maximum margin benefit – Smurfit Kappa’s treasury team has demonstrated how a cross-functional project can unify an entire business. This award-winning financing project has also illustrated how treasury can not only embrace and drive ESG, but also push the boundaries of sustainability norms.

Sustainability is in the DNA of Smurfit Kappa, the Dublin-headquartered paper-based packaging multinational. The firm designs, manufactures and supplies its products worldwide, operating in 36 countries across Europe and the Americas. Producing 7.7 million tonnes of packaging per year, the company recycles 6.3 million tonnes of recovered paper annually. Smurfit Kappa is also responsible for 67,000 hectares of certified forest plantation.

Emer Murnane, the company’s Assistant Group Treasurer, elaborates: “We’ve had ESG [environmental, social, and governance] embedded into the way we work for a long time, even before it became the prominent structural driver for businesses that it is today. In fact, since 2005, we’ve been reporting on our sustainability developments through our annual sustainable development reports. Our entire Sustainable Development Report is third party assured by KPMG per the Global Reporting Initiative (GRI) Guidelines (Comprehensive).”

The company recently upgraded its sustainability targets in a commitment called Better Planet 2050, which contains ambitious targets across many strategic areas. The initiative covers everything from CO2 emissions to the certified chain of custody, which guarantees that materials used come from sustainably-managed sources. Water usage is also addressed in several ways, including the water intake at the firm’s mills, the quality of water returned to the environment, and the associated waste handling. Beyond the environmental issues, the new targets also cover a range of diversity and inclusion (D&I) and community and social responsibility topics.

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