Investors can participate in Mercedes-Benz Group's sustainability goals. At the same time, Mercedes-Benz Group uses sustainable financial instruments such as green bonds and green loans to finance significant future investments.
We will continue broadening our green finance offering as well as developing additional exciting all-electric vehicles, so that the world’s most valuable luxury automotive brand can fund its transformation in a sustainable manner while creating new attractive green assets for investors.
Our Green Finance Framework in detail
The revised Green Finance Framework describes the principles used by Mercedes-Benz to issue green financing instruments including Green Bonds, Green Schuldscheine, Green Commercial Paper, Green Loans and to initiate the issuance of Green Asset Backed Securities (Green ABS). It has been created to reflect the new Group’s continued commitment to sustainability, new best market practice and legal reporting requirements such as the EU Taxonomy, as well as to enable our investors to support us in our aspiration and obligation to live up to our responsibility towards society and the environment.
This Framework has been developed to align with the 2021 ICMA Green Bond Principles (GBP), the 2021 APLMA, LMA and LSTA Green Loan Principles (GLP) and with the substantial contribution to climate change mitigation part of the technical screening criteria of the EU Taxonomy. The Swedish bank SEB and the French bank Société Générale acted as a consultant for the structuring of the framework.
With CICERO Shades of Green, now a part of S&P Global the Mercedes-Benz Group has commissioned a leading independent expert for the research-based assessment of Green Finance Frameworks with the review of its regulations. The Mercedes-Benz Group Green Finance Framework received the highest rating from CICERO with "Dark Green".
The Mercedes-Benz Group will allocate the net proceeds from the green financing instruments to the Green Bond Principles category “Clean Transportation” to finance capital expenditures for the acquisition, construction, development, installation, manufacturing, renovation, retrofitting and upgrade of eligible assets, related research and development as well as customer financing and leasing of eligible assets.
To enable investors to follow the progress and to provide insight to prioritised areas, the Group will provide a Green Finance Investor Report on an annual basis until full allocation of the proceeds, and thereafter in case of any material change to the allocation. The report will also include information on the development of the transition towards net carbon-neutral mobility and, in particular, how the allocation of proceeds from our Green Finance Instruments are contributing towards the transition to sustainable mobility.
The first benchmark Eurobond issued by the Mercedes-Benz Group AG in September 2020 with a volume of €1 billion, a term of 10 years and an annual coupon of 0.75% was more than 4-times oversubscribed and driven by a high-quality orderbook. The issuance was arranged by BBVA, BNP Paribas, Commerzbank, Crédit Agricole, SEB and Unicredit.
In March 2021, Mercedes-Benz Group AG issued a second green bond. The paper has a volume of €1 billion, a term of twelve years and an annual coupon of 0.75%.
In November 2022, Mercedes-Benz’s issued its first Green Bond outside of the European market. Mercedes-Benz International Finance B.V. successfully issued its first Green Panda Bond with a size of RMB 500 million (approx. EUR 68 million), a term of two years and a coupon rate of 2.9% in the Chinese Interbank Bond Market. The issuance was arranged by Bank of China and HSBC.
Use of the proceeds
Mercedes-Benz Group will use the net proceeds from the green financing instruments for the development, production and customer financing/leasing of Battery Electric Vehicles (BEV). The use of proceeds and the environmental impact, when feasible and subject to data availability, the Group will publish a Green Finance Investor Report on an annual basis until full allocation of the proceeds, and thereafter in case of any material change to the allocation.
Our Green Finance Investor Report
With our first Green Finance Investor Report in line with our Green Finance Framework commitments and transparency journey, we want to give you an insight into how we are using the funds from these first two green bonds, that we issued in September 2020 and March 2021.
In addition to an in-depth presentation of our Green Investment Strategy, this report includes a detailed description of the financed projects (allocation report), as well as additional key figures and information on their respective effects on CO₂ emissions (impact report).