Asda has partnered with Lloyds Bank to launch a sustainability-linked supply chain finance programme, offering its UK suppliers access to “preferential rates based on sustainability performance”.

The supermarket’s suppliers will be scored against a range of KPIs, with those showing strong progress on sustainability commitments offered tiered enhanced terms and expedited payment.

The initiative, which is expected to go live in October, converts Asda’s existing supplier finance scheme and builds on a similar initiative it introduced last year with HSBC for its import suppliers.

Asda has appointed Ecovadis, the global sustainability ratings platform provider, to help assess suppliers’ environmental, social, and ethical performance across their value chains.

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.”

Lloyds managing director and head of consumer Aled Patchett added: “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.”

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