Air France-KLM and Accor will pay higher interest rates on some debt after missing climate targets tied to their sustainability-linked bonds.
Both companies disclosed the penalties in financial filings over the past week.
Sustainability-linked bonds are a type of debt where the interest rate a company pays is tied to whether it meets environmental targets. If a company hits its goals, it continues paying the agreed interest rate. If it misses them, it faces a penalty.
Accor Misses Two Climate Targets
In November 2021, Accor obtained a €700 million sustainability-linked bond with a 2.375% interest rate, which it had agreed to pay off in November 2028.
The bond was tied to two specific greenhouse gas reduction targets, both measured against a 2019 baseline and to be achieved by the end of 2025.
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