Weir Group PLC Sustainability-Linked Bond Second-Party Opinion (2021)
Weir Group PLC
Sustainability Linked Bond or Note
Use of Proceeds
Sustainalytics is of the opinion that the Weir Group Sustainability-Linked Bond Framework aligns with the Sustainability-Linked Bond Principles 2020. This assessment is based on the following:
Selection of Key Performance Indicator (KPI)
Weir Group Sustainability-Linked Bond Framework includes one KPI: Scope 1 and Scope 2 GHG emissions intensity (measured in tCO₂e per £m revenue. See Table 1). Sustainalytics considers the KPI chosen to be adequate based on its relevance to Weir Group’s business, scope of its applicability, and its clear and consistent definition.
Calibration of Sustainability Performance Target (SPT)
Sustainalytics considers the SPT to be aligned with the Issuer’s sustainability strategy. Sustainalytics further considers the SPT to be moderately ambitious given that it targets a material improvement in the Company’s GHG emissions performance and given the Company’s industry leadership, which is demonstrated through its disclosure and transparency.
Weir Group PLC will link the bond’s coupon rate to the achievement of the SPT. The coupon rate will be adjusted upwards by 25 basis points (25bp) if the Company fails to achieve the SPT. The adjustment will also be applied if the SPT cannot be calculated or observed in a satisfactory manner, or the Company does not publish the SPT within a timeline defined in bond documentation.
Weir Group PLC commits to report performance on the KPI in its annual report, which is available on its website. The Company commits to disclose relevant information that affects its performance on the KPI, such as any re-assessments of KPI and/or restatement of the SPT and/or pro-forma adjustments of baselines or KPI scope. The reporting commitments are aligned with the SLBP.
Weir Group PLC commits to have external limited assurance conducted on its KPI performance at the communicated SPT deadline, which is aligned with market expectations.