MARC Ratings has assigned a “Gold” Impact Assessment to Johor Plantations Group Berhad’s (JPG) Sustainable Finance Framework. The framework was established to outline how JPG plans to undertake sustainable finance transactions to deliver environmental and social benefits.

JPG is involved throughout the value chain of the palm oil business, from cultivating oil palms to producing crude palm oil, managing a total landbank of 59,819 ha and five palm oil mills. A subsidiary of Kulim (Malaysia) Berhad, JPG was listed on the Main Market of Bursa Malaysia on July 9, 2024.

The framework was developed with an integrated approach, encompassing use of proceeds and sustainability-linked components which can be used independently on a case-by-case basis. Proceeds raised from the use of proceeds instruments will be channelled towards eligible green and social projects listed in the framework. Conversely, sustainability-linked instruments align JPG’s sustainability ambitions with its business strategies, supported by three key performance indicators (KPIs) that are relevant, core, and material to the company’s primary business. The projects and KPIs defined in the framework collectively support nine of the 17 United Nations Sustainable Development Goals (UN SDGs).

We opine that the framework is aligned with the core components of the applicable guidelines, frameworks, and principles published by the Securities Commission Malaysia, ASEAN Capital Markets Forum, and the International Capital Market Association, among others.

The Gold assessment of the framework reflects the view that the sustainable finance transactions would provide relevant social and environmental benefits that support nine of the 17 UN SDGs.