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Luxury brand Prada has entered into a loan agreement worth €50 million as part of its pledge to become more sustainable.
The five-year loan agreement with Crédit Agricole Group, a European banking company, has a provision that allows Prada to decrease its annual interest rates based on three environment-friendly objectives. These include meeting the required training hours for Prada’s employees and continuously using Re-Nylon, a sustainable substitute for nylon. It also includes getting gold or platinum certification from the Leadership in Energy and Environmental Design (LEED), a group that can confirm whether an organization’s structures meet green standards.
The agreement between Prada and Crédit Agricole Group is considered to be the first sustainability-linked loan in the fashion industry. According to a Prada executive, the agreement proves that the company is gearing toward sustainability for its development.
Prior to the loan, Prada has already implemented several eco-friendly policies as part of its sustainability movement. Recently, the luxury brand unveiled a collection of bags made from recycled materials, like fishing nets and plastic waste.
The company has also announced that it will stop using animal fur early next year and that it will fully transition to using Re-Nylon from the latter part of 2021.
Prada’s head designer said that these changes would allow the company to be more creative while satisfying the consumer demand for sustainable and ethical products.
Recently, many consumers are becoming more attuned to the environmental impact of the products they buy. An industry expert believes that many other companies will follow Prada’s example as the sustainability trend drives many companies to shift to delivering environment-friendly and ethical products.