Westpac has today announced its support of North Queensland Airports (NQA) – the owner of Cairns and Mackay Airports – with one of the very first sustainable-linked loans in the Australian market to address biodiversity and natural capital. Westpac has acted as joint sustainability coordinator for the transaction.
The loan includes key performance indicators which incentivise the airport operator to enhance the habitat surrounding Cairns Airport and help save threatened wildlife, in partnership with the local Yirrganydji people.
Other initiatives linked to the agreement include the reduction of greenhouse gas emissions to net-zero by 2025, and support of First Nations peoples by prioritising procurement from contactors with a defined percentage of Aboriginal or Torres Strait Islander employees.
Eliza Mathews, Head of Sustainable Finance, Westpac Institutional Bank, said this innovative financing move by NQA will be followed by similar transactions globally and in Australia.
“We expect more corporate borrowers and lenders around the world will look to lift efforts to improve the state of nature, in the same vein as the past decade’s global push to get greenhouse gas emissions down to net-zero, and use sustainable financing to achieve these goals.
“While the focus on natural capital is about 10 years behind climate, it’s not going to take 10 years to catch up given regulatory, stakeholder and market pressures related to stopping the decline of natural capital and biodiversity,” said Ms Mathews.
“Following the Taskforce on Nature-related Financial Disclosures (TNFD) draft reporting guidelines in March, and with obligations anticipated to commence in September next year, we expect to see more companies starting to look at natural capital, accounting for it and focusing their own sustainability efforts to improve in that area,” said Ms Mathews.
North Queensland Airports chief executive, Richard Barker, says wrapping biodiversity targets into a financing structure makes good business sense and provides additional motivation for his organisation to deliver on its environmental promises.
“Cairns Airport plays an important role as a gateway to Queensland’s world heritage areas – the tropical rainforests and the Great Barrier Reef – and also remote parts of the far north of the state,” Barker says.
“We have a role to play in protecting the pristine environment in which we operate. We can’t just rely on the government to do these types of projects.
“By actually linking our environmental targets into our refinancing, it really commits us as an organisation to deliver on what we say, not only around reducing our emissions, but to actively encourage the regeneration of biodiversity in this area.”
