The future price of bank loans will depend on the green credentials of borrowers
Wood Training has participated in a sustainability program and is one of the companies that have tested the BNZ Emissions Calculator.
Wood Training prepares workers in high-risk industries like oil and gas to survive extreme events.
The Taranaki-based company trains gas rig workers on how to escape if the helicopter they’re operating gets in a ditch in the sea, and it trains firefighters, which often involves simulate real fires.
In this increasingly climate-conscious world, Wood Training has embarked on a sustainability program to reduce its environmental impact.
It also led her to become one of the companies to test an emissions calculator launched by the Bank of New Zealand on Tuesday, which she says could make it easier for small businesses to measure and reduce their emissions.
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Matthew Ries, Commercial Director at Wood Training, said: “We were on the right track with sustainability, but the calculator helped us define it.
Wood Training reduced waste, increased recycling and sourced biofuel made from the dairy industry’s lactose waste for its firefighting training.
Ries said the program has reduced costs, but sustainability is becoming a major issue for companies.
“I think you’re expected to be durable,” he said.
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Wood Training counted many multinational corporations among its clients, as well as government agencies, including the New Zealand Defense Force.
But Ries said the company didn’t need its customers’ harsh words to ensure sustainability was key to the company’s future.
Banks are focusing more on making green loans, and BNZ hopes the calculator will help it reduce the carbon footprint of its loan portfolio.
Rachel Brown, chief executive of the Sustainable Business Network, said that in the future, the price of a company’s debt will be influenced by its sustainability.
BNZ was already providing green financing, which included lower borrowing rates when companies met their emissions reduction targets, she said.
The Sustainable Business Network created the calculator in partnership with the bank, government, and other private and public organizations.
Rebekah Cain, BNZ’s director of sustainability, said the calculator was a game-changer for small and medium-sized enterprises (SMEs).
“Larger organizations have the resources to lead sustainability teams and define our plans and processes, but in the engine room of the economy, small and medium-sized businesses, there is less time and fewer resources to focus on sustainable development,” she said.
“By taking the outputs from the calculator, we hope to be able to link green finance to help SMEs meet their emissions targets.”
The calculator had the potential to accelerate transformation, she said.
The bank had set itself the goal of being net zero carbon emissions on its loans and investments by 2050.
It also aimed for half of its SME clients to measure their emissions, set reduction targets and report on their impact on climate change by 2025, she said.
Another company to drive the ECU is Taranaki Ice Electrical.
Its chief commercial officer Emah Tippett said the calculator was a good first step in developing a strategy.
Ice Electrical made the decision to do its part in creating a sustainable world because customers were not yet demanding sustainability from the companies they dealt with, Tippett said.
But that was starting to change, he said.
“A few clients ask, ‘What are you doing to play your part?’ The conversation is out there, and it will happen more and more over the next two years,” she said.