Prada Signs a $109.2 Million USD Sustainability-Linked Loan
The five-year loan will be linked to KPIs of the brand’s environmental responsibility efforts.
Prada SpA has inked a €90 million EUR (roughly $109.2 million USD) five-year loan with Italian banking group UniCredit tied to sustainability-related key performance indicators: namely, “the regeneration and reconversion of production waste and Prada’s ability to increase the share of self-produced energy,” according to WWD. Prada will also be able to reduce its interest payment on the loan by meeting other quantifiable targets in its sustainability efforts, as evaluated by an independent third-party reviewer.
Alfredo De Falco, UniCredit’s Italy head of corporate and investment banking, explains that sustainability has emerged across luxury fashion, and business at large, as “a key competitive factor for businesses” in both consumer and investor relations. And Prada has made several attempts over the last few years to prove its commitment.
The Italian brand launched its “Re-Nylon” collection back in 2019, and that same year, Prada also became the first luxury brand to sign a loan tied to sustainability-related conditions, following an approximately $55 million USD agreement with the French banking group Crédit Agricole. This five-year loan included a focus on green-building certifications for Prada’s stores, increased training hours for employees and phasing out virgin nylon by 2021.
However, luxury labels like Prada have also faced criticism for complacency, narrative-shifting and a lack of meaningful action. HYPEBEAST recently spoke to various industry leaders about what meaningful sustainability initiatives in fashion may be — and which to take with a grain of salt.
