Prada has signed a £42.9 million loan with banking group Crédit Agricole, with repayment terms conditional to meeting key targets around the sustainability of its products and operations.
According to Prada ? which also owns subsidiary brand Miu Miu ? this marks the first time that a luxury brand has procured a sustainability-linked loan.
In these transactions, the lender's meeting of certain social and environmental goals is incentivised through the favourable or unfavourable adjustment of interest rates.
In this case, that means Prada's interest payments on the five-year loan will be determined annually based on whether the company has hit three specific objectives.
The first focuses on its physical shops, setting out that a certain number of them need to be certified gold or platinum according to the green-building rating system Leadership in Energy and Environmental Design (LEED). This evaluates everything from the design and construction of a building to its management and the extent to which it uses resources and produces waste.
Prada's Re-Nylon bags are made made from Econyl, an infinitely recyclable yarn made from regenerated plastic waste
The other targets are related to the amount of training hours given to employees, and reinforce a pledge made by Prada earlier this year which involves phasing out the use virgin nylon by 2021.
Instead, a growing number of the brands' products ? including a dedicated Re-Nylon collection of bags ? are being made from Econyl, an i...