KUALA LUMPUR: Boustead Plantations Bhd (BPB) has signed an RM45 million green finance agreement with China Construction Bank (Malaysia) Bhd (CCBM) to assist with its sustainable replanting project.

In a statement, the palm oil company said it seeks to leverage the financing to maximise its ongoing accelerated sustainable replanting programme, particularly for its plantation assets in Sabah, until 2024.

BPB chief executive officer Zainal Abidin Shariff said the company is always on the lookout for collaborative financing exercises in the financial and debt market that emphasises the principles of environmental, social and governance (ESG).

“BPB has demonstrated a positive track record in its adherence towards sustainability practices, with 100 per cent of its land area having been certified with Malaysian Sustainable Palm Oil, whilst six of its Roundtable on Sustainable Palm Oil (RSPO) certified palm mills are accredited with the Supply Chain Certification System.

“Our sustainable agricultural practice includes, amongst others, a zero burning technique that is environmentally friendly and recycling nutrients contained in palm biomass.

“The green financing agreement would allow BPB to complement its ongoing Plantations Performance Improvement Programme by optimising the potential of its plantation assets in Sabah,” Zainal Abidin said.

The financing agreement was signed by BPB director Ahmad Shahredzuan Mohd Shariff and its company secretary Affendi Mohd Yob, while CCBM was represented by its executive vice president Wang Shaoqiang.

CCBM chief executive officer Wang QiJie said that the signing was a significant milestone for CCBM as it will be the bank’s first Green Plantation Financing in Malaysia.

“CCBM would like to see a continuation of the bank’s joint efforts to build a long term and strategic partnership with BPB,” he added.

BPB’s debt-to-equity ratio has improved in recent years owing to its strong financial performance, with gearing standing at 0.28 times as of March 31, 2022, from the December 31, 2021 position of 0.37 times.

Source: New Straits Times