That’s a wrap! How a packaging manufacturer used its sustainability score to drive business growth

Family-owned Finest manufactures plastic packaging for multiple industries, including the food sector. As with many of its peers, its dependence on plastic means the business has a heavy carbon footprint and is exposed to elevated environmental risks. The company, however, is working to improve the recyclability of its products and reduce material use to minimise carbon emissions across the product lifecycle.

This commitment to sustainability recently helped Finest to unlock commercial benefits as the foundation for a Sustainability Improvement Loan (SIL) from HSBC.

For Jimmy Lau, Vice President at Finest, the link between sustainability and business growth is clear. It obtained its first ESG rating from EcoVadis over five years ago and has been able to use its improving performance to build trust with its customers and drive consistent sales growth.

“Sustainability is a key consideration for end buyers, especially for companies aiming to meet carbon emission targets across their value chain. Third-party assessment is increasingly becoming essential for businesses like ours that want to be part of the global supply chain,” said Lau.

Finest has taken steps to improve its ESG score, working with its customers to develop packaging that reduces material use, improves manufacturing efficiency and complies with local recycling and environmental regulations. It also works with its own suppliers to increase recycled content in its products and reduce transport-related emissions. The company earlier this year reached gold medal status with EcoVadis, one of the world’s largest providers of business sustainability intelligence and ratings, placing it in the top 5% of EcoVadis clients worldwide.

Finest’s improving rating has allowed the company to access sustainable financing for the first time, in the form of a Sustainability Improvement Loan from HSBC.

HSBC launched the SIL product in Asia in 2024, building on strong momentum in the UK. Borrowers are required to complete an annual sustainability assessment throughout the duration of the facility. Those whose scores improve may benefit from a reduced interest rate. Similarly, the interest rates may increase if the borrowers’ scores decline.

An SIL can be used for any purpose, making it a suitable product for a wide range of small and medium-sized businesses that are looking to connect their funding costs with their sustainability progress. In Finest’s case, the SIL is a trade finance facility supporting its export contracts.

The solution appealed to Finest as a way to improve transparency and enhance its engagement with its customers. The single sustainability metric is also clear and easy to monitor for the company’s existing staff.

“We’re not a big conglomerate, and we don’t have a dedicated ESG team that can fulfil the numerous criteria and extensive documentation work required for complicated sustainable financing products,” said Lau at Finest.

The SIL format is designed for mid-market and smaller businesses to link the cost of financing to their sustainability performance.

“This SIL ties Finest’s cost of funding directly to its sustainability rating and gives the company an added incentive to continue its sustainability progress,” said Alice Suen, Managing Director, Head of Sustainable Finance and Transition at HSBC Hong Kong. “Tools like these combine our deep understanding of our customers’ financing needs and our desire to support their transition towards a more sustainable business.”

An ESG rating from EcoVadis is tailored to a company’s size, industry and location, and can be as simple as completing an online questionnaire¹. The annual assessment looks at environmental, social, business ethics and supply chain factors, and comes with guidance and tips on how a score can be improved.

“Sustainability performance has been linked with a range of commercial benefits, from increased efficiency and reduced financing costs to better consumer engagement,” explained Richard Bourne, SVP, Asia Pacific and Japan at EcoVadis, which rates around 40,000 companies in Asia Pacific out of 150,000 globally, at the time of writing.

“Companies are being encouraged to be more transparent about their supply chains, and about their own practices as well. The companies who are seen as first movers and are able to be transparent with their buyers are getting more business,” he said.

For Finest, the SIL comes with two key benefits. It provides a working capital facility, with the potential for interest rate savings, and strengthens the link between sustainable practices and commercial outcomes.

“Many of our customers are actively looking for partners that are aligned with their own sustainability ambitions,” said Lau at Finest. “Tracking our improvement data and linking it to sustainable financing helps build accountability within our team, and demonstrates to our partners and our customers that our commitment to sustainable packaging is not just talk.”