Asda’s new scheme with Lloyds offers preferential financing rates to UK suppliers based on sustainability performance.
EcoVadis will provide independent assessments to benchmark suppliers on environmental, social, and ethical practices.
The program builds on Asda’s 2024 finance initiatives and underscores its push to embed decarbonisation and social impact into its supply chain.
Asda has launched a sustainability-linked supply chain finance program with Lloyds, offering UK suppliers improved payment terms and rates tied directly to their sustainability performance.
Under the scheme, suppliers who voluntarily share their sustainability data and demonstrate progress against key performance indicators will access the most competitive financing. Those not engaging remain on existing terms without disruption.
Michael Gleeson, Chief Financial Officer at Asda, 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.”
RELATED ARTICLE: Lloyds, OFI, and North East Mayor Unite to Unlock Green Investment in UK Energy Hub
EcoVadis, the global sustainability ratings platform, has been appointed to evaluate suppliers’ environmental, social, and ethical performance. The scoring will inform the tiered structure of the finance scheme, ensuring suppliers with stronger sustainability credentials are rewarded with the best terms.
The program expands on Asda’s 2024 partnership with another bank, which marked its first sustainability-linked supply chain finance initiative. Both efforts aim to embed sustainability standards into procurement and financing, with particular focus on decarbonization and social responsibility.
Aled Patchett, MD and Head of Consumer at Lloyds, 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.”
Suppliers that meet the criteria can begin accessing the scheme as early as October this year. Asda already requires its largest suppliers—responsible for around 80% of its product carbon emissions—to submit sustainability data through EcoVadis.
Follow ESG News on LinkedIn
