Second-Party Opinion Download

Sustainalytics is of the opinion that the FEMSA Sustainability-Linked Bond Framework aligns with the Sustainability-Linked Bond Principles 2020. This assessment is based on the following:

Selection of Key Performance Indicators (KPIs)

The FEMSA Sustainability-Linked Bond Framework includes two KPIs: (i) Zero Operational Waste to Landfill and (ii) Renewable Energy (see Table 1). Based on the consideration for the materiality of the KPIs, their relevance to FEMSA’s business and the scope of their applicability, Sustainalytics considers KPI 1 to be strong and KPI 2 to be very strong.

Calibration of Sustainability Performance Targets (SPTs)

Sustainalytics considers the SPTs to be aligned with FEMSA’s sustainability strategy. Sustainalytics further considers SPT 1 to be ambitious based on past performance and alignment with industry best practice. SPT 2 is considered to be ambitious based on the implied rate of Scope 2 emissions reduction, the Company’s past performance and considering the challenges faced in scaling renewable energy procurement, specifically in the Latin America region. 

Bond Characteristics

FEMSA will link the bond’s financial / structural characteristics to the achievement of the SPTs, namely an increase in the coupon-rate.  To not trigger a change in coupon, all SPTs need to be achieved (per tranche).  

Reporting

FEMSA commits to report on an annual basis on its performance on the KPIs in its sustainability report. FEMSA also commits to disclose relevant information that affects the KPIs performance. The reporting commitments are aligned with the SLBP. 

Verification

FEMSA commits to have external limited assurance conducted on its KPI performance at the communicated SPT deadline, which is aligned with market expectations.