Bridgestone Initiates Sustainable SCF with External Ratings
(11 May 2021 – Global) By linking pricing to independently verified sustainability criteria, CFOs can utilise supply chain finance (SCF) for promoting environmental, social and governance (ESG) goals in their own company and up and down their supply chain as evidenced by Bridgestone.
Bridgestone’s initial request for proposal (RFP) was issued to 12 financial partners. Some RFP participants were coalitions between fintechs and banks, others were standalone bank propositions, and there were also single name fintech offerings. While the fintechs did not succeed in winning the RFP, the group noted all the shortlisted pitches had a bank and a fintech or only a bank backing them.
After detailed scrutiny of the RFPs, Bridgestone opted to go with the partnership of JPMorgan and Taulia for the sustainable SCF programme, which uses a pricing matrix linked to EcoVadis data.
One of the key strengths cited by Bridgestone of the Taulia and JPMorgan partnership was the streamlined, digitised onboarding process.
“Taulia has entirely digitised onboarding to the platform and is completely aligned with J.P. Morgan processes. As with any supply chain financing solution, you need to make sure that the bank[s] backing the solution are comfortable with the documentation that is in place in the front end. Having J.P. Morgan joined up with Taulia at the back end, and comfortable with the documentation, is a significant additional benefit” stated Bridgestone Treasury Director for Europe, the Middle East, India and Africa (EMIA), Julle Pedersen.
“We started thinking about implementing SCF around two years ago. During that exploratory phase, I could not find a case study from a company that had leveraged external ratings as part of their sustainable SCF programme. Up until that point, most leading initiatives I heard of were internally rated and somewhat subjective” commented Pedersen.
“We already had our global sustainable procurement policy endorsed by business sustainability ratings firm EcoVadis, and I realised we could link the two together so everything began to take shape from there” Pedersen added.
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