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Starbucks issues US$1 billion sustainability bond

Starbucks has completed issuance of a US$1 billion sustainability bond, the largest the company has issued to date.

“We are very pleased to see that our new sustainability bond attracted significant investor interest and was oversubscribed,” Starbucks Chief Financial Officer Patrick Grismer says.

“The bond demonstrates Starbucks commitment to meaningful, continual progress toward our aspiration of sustainable coffee, served sustainably. It also illustrates a trend toward heavier interest from investors in our socially and environmentally focused projects – in this case supporting coffee farmers and leading in green retail.”

Grismer says Starbucks’ leadership in social and environmental responsibility is a defining element of the company.

“Our intent is that, by issuing a sustainability bond, we’re providing investors an opportunity to participate in our sustainability efforts, and our hope is that this inspires others to pursue more sustainability-related investing opportunities,” he says.

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As with the two previously issued sustainability bonds, in 2016 and 2017, funds will support ethically sourced coffee. This includes purchasing Coffee and Farmer Equity (C.A.F.E.) Practices-verified coffee, and agronomy research and development/support centres in coffee-growing regions around the world, and new and refinanced loans to coffee farmers made through Starbucks US$50 million Global Farmer Fund.

To aid the Global Farmer Fund, Starbucks has partnered with lending organisation responsAbility on a US$20 million equity investment to provide financing to coffee communities in Latin America, Africa, and Asia. This will come in the form of loans that can help replace old, less productive trees with new trees, buy new equipment, and take other actions to improve their coffee crops’ quality and productivity.

“We are excited to have the Starbucks Global Farmer Fund as a significant investor,” says Anand Chandani, Global Head of Agriculture Debt Financing at responsAbility.

“We see synergies with Starbucks in building the sustainable coffee value chain, supporting smallholder farmer engagement and in fostering market linkages.”

The bond will also help fund Starbucks’ Greener Retail commitments, including its Greener Stores initiative, announced in September 2018, to design, build, and operate 10,000 Greener Stores globally by 2025.

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