Standard Chartered & COFCO: Boosting Sustainable Agriculture

One thing has always been true: money makes moves.

As global supply chains adapt to decarbonisation pressures, deforestation-free commitments and human rights due diligence requirements, the financial sector's influence on sustainability outcomes across procurement networks is becoming pivotal.

Sustainability-Linked Loans (SLLs) and green credit facilities – once pilot tools of niche financiers – are now shaping corporate behaviour across critical sourcing operations. This shift means finance is no longer simply enabling trade, but actively directing how commodities move from field to end user.

COFCO International and Standard Chartered are executing this in practice, having closed a US$435m sustainability-linked revolving credit facility designed to strengthen responsible agriculture procurement in South America.

The partnership marks the first publicly disclosed SLL in the region's agriculture sector focused entirely on social and resilience outcomes – underlining how finance can drive the transformation of agricultural supply chains from the ground up. For procurement leaders managing complex sourcing networks, this structure introduces a template where capital costs directly reflect supply-chain performance.

"This facility represents a deep integration of our sustainability goals with corporate financial management, reinforcing our long-standing commitment to responsible sourcing and supply chain safeguards across key origination markets," says Helen Song, Chief Financial Officer at COFCO International.

"By innovatively linking financing to measurable progress in certified sourcing and supplier due diligence, the structure supports the continued expansion of responsible and certified sustainable agricultural supply chains and improved market access for producers."

Linking capital to sourcing performance

The loan is an innovative financial structure that directly connects capital access to measurable supply chain improvements. COFCO International's loan terms are linked to two externally verified performance indicators that address upstream sourcing risks.

First, the company will increase the volume of grains and oilseeds certified under internationally recognised responsible agriculture standards, including its own COFCO Responsible Agriculture Standard, which underpins ethical production and land-use practices across its sourcing regions. This metric essentially measures the depth of certified materials flowing through COFCO International's procurement channels.

Second, the company will strengthen supplier due diligence and labour safeguards, particularly in Brazil's soy and corn supply chains – areas vital to global food and feed markets but historically exposed to social and environmental challenges. Enhanced due diligence could mean improved visibility into tier two and tier three suppliers, addressing blind spots that have long complicated traceability efforts.

Performance against these targets determines COFCO International's loan margin adjustments, meaning better sustainability results lead to more favourable financing terms. This structure, assessed against the Sustainability Linked Loan Principles, introduces measurable accountability into capital allocation, ensuring that sustainability commitments are more than statements – they are commitments with financial weight tied directly to procurement outcomes.

Building traceable sourcing networks

As the overseas agriculture business platform of China's COFCO Group, COFCO International is one of the world's leading agri-traders, sourcing, processing and transporting grains, oilseeds and other commodities across more than 35 countries. Its influence in South America – particularly Brazil and Argentina – makes it a key conduit for global food security and supply-chain resilience.

Over recent years, the company has strengthened its sustainability framework to better manage risks associated with land-use change, labour conditions and supply chain transparency. Its Responsible Agriculture Standard defines expectations for ethical and environmentally sound farming practices, while traceability programmes help identify potential social and environmental impacts embedded within upstream sourcing.

For Standard Chartered, this deal represents another step in its strategy to channel capital towards sustainable development in emerging markets. The bank has long championed innovative sustainability-linked instruments that go beyond traditional environmental metrics, addressing social inclusion and supply-chain resilience.

"Leveraging our sustainable finance expertise to help close Standard Chartered's first social resilience themed Sustainability-Linked Loan is an important step," says Marisa Drew, Chief Sustainability Officer at Standard Chartered.

"Sustainability-linked financing has principally revolved around mitigating greenhouse gas (GHG) emissions and managing environmental risks and impacts of business operations, however for COFCO International, we have used our deep supply chain expertise to structure a transaction that focuses on addressing social and resilience risks to their global supply chains."

Sustainability, procurement and supply chain leaders won’t want to miss Procurement & Supply Chain LIVE, taking place at Navy Pier, Chicago, on April 21–22.
Co-located with Sustainability LIVE: The US Summit, the event unites senior decision-makers at a time when supply chains, sustainability and business performance are more interdependent than ever.
Secure your place now for The US Summit – group booking discounts available

Driving supplier accountability upstream

South America's agriculture sector plays a critical role in feeding the world, yet faces mounting pressure from deforestation, labour rights allegations and climate volatility. Strengthening land-use governance, supplier due diligence and certification systems is now essential to protect both productivity and reputation across increasingly scrutinised procurement networks.

By directly linking interest rates to measurable improvements in responsible sourcing and labour safeguards, the COFCO–Standard Chartered loan catalyses tangible action at the supplier level. It incentivises continuous improvement among suppliers, supports the professionalisation of farmer networks and helps align regional production with the expectations of international buyers and regulators navigating complex due diligence legislation.

This approach also sets a valuable precedent for other agribusinesses managing multi-tier sourcing operations. With scrutiny of agricultural commodities intensifying – especially around soy, corn and palm oil – embedding sustainability performance into financing frameworks may soon become industry standard across procurement functions.

Ultimately, the partnership demonstrates how finance can serve as both carrot and compass, steering global supply chains toward practices that value people as much as productivity.

"The closing of this pioneering Sustainability-Linked Loan with COFCO International reflects our commitment to progress commerce in a way that delivers real impact for communities and supports a just transition," says Wan Thonh, Head of Coverage, SG & ASEAN, Standard Chartered.

"This milestone demonstrates the strength of our long-standing relationship with COFCO International and the trust they place in Standard Chartered, which enabled us to originate and structure a solution aligned to both COFCO International's sustainability ambitions and our own values."