Healthcare technology company Royal Philips signed an agreement with a consortium of 16 banks for a new €1 billion ($1.09 billion) revolving credit facility with an interest rate that will be dependent on the company’s year-on-year sustainability performance improvement.

This innovative construction was created by Philips in collaboration with ING as the sustainability coordinator of the facility, and supported by the banks in the consortium, comprising ABN AMRO, Bank of America Merrill Lynch, BNP Paribas, Citi, Deutsche Bank, Goldman Sachs, HSBC, ICBC, ING, JPMorgan, Mizuho Bank, Morgan Stanley, MUFG, Rabobank, Société Générale and UBS.

Netherlands-based Philips’ current sustainability performance has been assessed by Sustainalytics, an independent provider of environmental, social and corporate governance research and ratings. The resulting score will be used as the benchmark against which performance improvements will be assessed.

“I am pleased that following the launch of our ambitious ‘healthy people, sustainable planet’ program last year, we are now able to link the interest rate structure of our new revolving credit facility to our sustainability performance,” said Abhijit Bhattacharya, CFO of Royal Philips. “This underlines our commitment to sustainability as an integral part of how we do business.”

The new facility has a maturity date of April 21, 2022, for general corporate purposes. It replaces Philips’ current €1.8 billion ($1.95 billion) facility, which remained undrawn.