Volvo joins green finance rush

Volvo Cars has announced its Green Finance Framework, a defined structure that will allow the company to fund its climate plan and electrification strategy by issuing green bonds or obtaining green loans.

Paving the way for Volvo to issue its first green bond, the proceeds of these bonds will be used to fund last year’s announcement of a climate plan to addresses carbon emissions across all its operations and products, as it strives to become climate-neutral by 2040. The framework has been reviewed by Cicero, receiving the company’s highest possible rating of Dark Green.

“Volvo Cars has one of the most ambitious climate plans in the auto industry,” said Håkan Samuelsson, chief executive. “Our Green Finance Framework allows investors to participate in the transformation of Volvo Cars into an electric car maker.”

The plan goes beyond addressing tailpipe emissions through electrification; the company will also tackle carbon emissions in its manufacturing network and wider operations, its supply chain and through recycling and reuse of materials, and as a first, tangible step towards its vision the company aims to reduce its lifecycle carbon footprint per car by 40 per cent between 2018 and 2025. This includes a 50 per cent reduction in tailpipe emissions per car, a 25 percent reduction per car in operational carbon emissions, including from manufacturing and logistics, and a 25 per cent reduction per car in supply chain carbon emissions.

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