Pandora Issues Rare Sustainability-Linked Bond Tied to Gender Diversity Goals


In an uncommon move, Pandora has become one of only a few global companies to raise debt against its ability to meet gender diversity targets.

On Thursday, the Copenhagen-based jewellery giant issued a €500 million ($540 million) sustainability-linked bond on Ireland’s main stock exchange. Like many other companies, Pandora linked the debt to its goal of achieving a 36 percent reduction in carbon emissions by 2028 — but it’s also tied to its gender diversity target of having 44 percent women in leadership by the same deadline.

If Pandora fails to meet its targets, it will face a penalty of roughly €5 million on the loan. The fines are split 60 percent (€3 million) for carbon emission goals and 40 percent (€2 million) for gender diversity targets. Currently, all of Pandora’s financing — including two bonds, a revolving credit facility and a loan from the Nordic Investment Bank — is linked to sustainability.

Across fashion and other industries, similar sustainability-linked financial mechanisms are becoming an increasingly popular source of capital for climate-friendly initiatives. Companies like Chanel, VF Corp, Burberry, and Adidas have all taken on debt tied to environmental initiatives in recent years but only a few companies — in sectors like private equity and energy — have tied their bonds to gender goals.

But these types of financial instruments have also attracted criticism. Companies set their own targets, which often aren’t that challenging, critics say. In some cases, they are already close to or have achieved their targets, making some of the associated risk irrelevant.

Currently, Pandora’s leadership is 34 percent female. Its emissions have come down 27 percent since 2019 and are on track to decline 50 percent by 2030, chief financial officer Anders Boyer said.

“[We’ve had] quite good traction so far but as [is the case] in many aspects of corporate life, it gets incrementally more difficult to reduce carbon emission and get to gender parity,” Boyer said.

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