CBA helps arrange an SLL for North Queensland Airports

CBA has helped arrange a sustainability-linked loan (SLL) for North Queensland Airports (NQA) which – in what is believed to be a first for the Australian sustainable finance market – includes a biodiversity target focused on species conservation.

As part of the loan, NQA aims to enhance the habitat of at least three threatened species in partnership with the Dawul Wuru Aboriginal Corporation’s Yirrganydji Land and Sea Ranger program.

The loan aligns NQA’s environmental priorities to its financing, by linking the cost of borrowing to achieving key sustainability targets within a specified timeframe.

Sally Reid, executive general manager global client solutions at CBA, says NQA’s innovative sustainability targets would build on a broad and long-running sustainability program and commit the company to reaching for ambitious outcomes in this important sphere.

"NQA is the first Australian organisation to set a target to support the recovery of endangered species populations, breaking new ground for the domestic sustainable finance market and highlighting the importance of preserving species diversity as part of securing a sustainable future,” she says.

The SLL’s other sustainability targets include the reduction of Scope 1 and 2 greenhouse gas emissions to net zero by 2025, as well as a requirement to measure and reduce Scope 3 emissions. The structure also supports improved opportunities for First Nations peoples by prioritising procurement from contactors with a defined percentage of Aboriginal or Torres Strait Islander employees.

“The initiatives reflect the importance of addressing climate change, our stewardship of important natural habitat and the opportunity we have to ensure that Australia’s First Peoples are empowered to contribute to our operations,” says Richard Barker, CEO of NQA.

CBA served as a joint sustainability coordinator and lender on the transaction.

“Excitingly, NQA’s sustainability targets are a nexus of the airport’s sustainability, biodiversity and First Nations peoples engagement work,” says Charles Davis, CBA’s managing director of sustainable finance and ESG.

“This transaction really demonstrates to the market how to capture a more holistic approach at a time when many listed institutions are increasingly considering biodiversity in their sustainability ambitions,” he says.