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Kellogg’s Looks To Advance Its Work In Global Hunger Relief

One way large corporations can make a positive impact on the environment and the world is by issuing sustainability bonds, where proceeds are used to finance or refinance green and social projects. Kellogg Company became the latest high-profile brand to take this route when the iconic cereal maker successfully priced a $363 million, eight-year sustainability bond on May 11.

The bond – the first ever issued by Kellogg’s – carries an interest coupon of 0.50 percent per annum. Net proceeds will support the company’s Better Days program, which looks to address interconnected issues of wellbeing, hunger relief, and climate resiliency to improve the lives of 3 billion people by 2030. 

An amount equal to the net proceeds will be used to finance or refinance projects within one or more of the following categories: food security and sustainable food systems, renewable energy, energy efficiency, circular economy, green buildings, sustainable water, and wastewater management, and environmentally sustainable management of living natural resources and land use.

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Kellogg’s has a long history of charitable and social work, with much of its recent focus on its Better Days initiative. One part of that program, Breakfasts for Better Days, has provided 1.9 billion servings of food to needy people since 2013.

The Battle Creek, Michigan-based company’s current mission is to create “3 billion better days” for people worldwide. It plans to accomplish the goal through a multi-pronged plan that includes donating 2.5 billion servings of food, expanding its breakfast program to reach 2 million children, supporting the livelihoods of 500,000 farmers, and involving its employees in 45,000 volunteer days.

Kellogg’s has also been at the forefront of efforts to help those who have struggled during the COVID-19 pandemic. As of last June, Kellogg’s and its charitable funds had already donated more than $13 million in food and cash to global COVID-19 hunger relief efforts, in addition to providing 446 million servings of food worldwide in 2019. 

“Kellogg has always been a purpose-driven organization – it’s in our DNA,” Kellogg’s CEO Steve Cahillane said in a press release announcing the sustainability bond. “Our founder, W.K. Kellogg was an early conservationist, a leading philanthropist, and an original well being visionary. With this legacy, we’ve inherited his commitment.”

Sustainability bonds have become a much bigger part of the financial community in recent years. Between 2016 and 2020, corporate green-bond issuance rose by about eightfold to $77.4 billion, according to data provider Dealogic. 

Kellogg’s bond followed close on the heels of a $1 billion sustainability bond issued by Amazon. The proceeds of that bond will be used to fund projects in five areas: renewable energy, clean transportation, sustainable buildings, affordable housing, and socioeconomic advancement and empowerment.

In February, Goldman Sachs issued its first sustainability bond, priced at $800 million, as part of the investment bank’s goal to mobilize $750 billion in green finance by 2030. Its bond will be used to support businesses and projects in nine key areas: clean energy, low-carbon transport, sustainable food and agriculture, waste management and materials, ecosystem services, accessible and innovative healthcare, accessible and affordable education, financial inclusion, and community sustainability.

Meanwhile, last fall The Wall Street Journal reported on a number of other leading companies that had recently issued green or sustainable bonds, including luxury fashion brand Chanel, pharmaceutical company Novartis AG, and Brazilian paper maker Suzano SA. 


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