UK grocery retailer Asda has unveiled a new supply chain finance scheme in collaboration with Lloyds , designed to incentivise sustainability among its domestic suppliers.
The programme transforms Asda’s current system by providing suppliers with “preferential” financing rates that are contingent on their sustainability performance against key performance indicators (KPIs) and sustainability data sharing.
Asda has partnered with global sustainability ratings platform EcoVadis to evaluate and enhance the environmental, social, and ethical performance of suppliers across its value chains.
This latest scheme with Lloyds builds on Asda’s previous partnership with another bank in 2024, which marked the retailer’s initial foray into sustainability-linked enhancements for its ‘Supply Chain Finance’ scheme.
Asda chief financial officer Michael Gleeson said: “Supporting our suppliers in making meaningful, sustainable changes is central to our wider ESG ambitions. Through our new supply chain finance scheme with Lloyds, we’re strengthening that commitment – offering competitive financing that rewards progress and encourages transparency across our supply base.
“It’s a practical way to support our suppliers in making sustainable changes to their business, while building a more resilient and responsible supply chain for the future.”
Suppliers who meet the programme’s requirements can start reaping the benefits as early as October this year.
The programme ensures that there will be no operational disruptions for existing suppliers, while those opting not to participate will maintain their current payment terms and rates, stated the retailer.
As part of its ongoing sustainability efforts, Asda requires its largest suppliers, who are responsible for approximately 80% of its product carbon emissions, to submit sustainability data through the EcoVadis assessment platform.
Lloyds Consumer MD and head Aled Patchett said: “We’re proud to have supported Asda for many years in its work to build further resilience in its supply chain. Our existing programme has successfully supported suppliers over the years and converting it to reward sustainability efforts will not only deepen support for British businesses, it will also support Asda in meeting its own ESG ambitions.”
Earlier this month Asda announced that it is investing £11.8m ($15.67m) to refurbish stores in the county o Yorkshire and surrounding areas by the end of 2025.
“Asda to incentivise suppliers for sustainability data sharing” was originally created and published by Retail Insight Network, a GlobalData owned brand.
