LG Innotek said Wednesday it has secured $200 million in funding from the World Bank’s International Finance Corporation, which will be used for expanding the company’s manufacturing facility in Haiphong, Vietnam.
The eight-year sustainability-linked loan, designed to incentivize stronger environmental, social and governance management practices, marks the first time a South Korean company has obtained such funding from the World Bank unit. The electronic component manufacturer applied for the loan last year and was awarded approval after review.
Under the program, companies that meet ESG targets receive lower interest rates.
“We are pleased to have signed IFC’s first SLL with a Korean company through LG Innotek,” said Carsten Mueller, IFC's regional industry director for manufacturing, agribusiness and services in Asia. “IFC will continue to strengthen cooperation with LG Innotek to promote sustainability.”
Park Ji-hwan, chief financial officer of LG Innotek, said the funding underscores the company’s long-term ESG commitment. “LG Innotek will continue to take the lead in ESG management and grow as a company that provides differentiated value to customers.”
LG Innotek announced its vision in 2022 to switch 100 percent of its electricity use at its businesses to renewable energy by 2030 under the global RE100 initiative. It has also set the ambitious goal of achieving carbon neutrality by 2040.
In 2024, the company converted nearly 60 percent of its global electricity consumption, or 638 gigawatt hours, to renewable sources. Additionally, its plants in Vietnam's Haiphong and in South Korea’s Paju, Gyeonggi Province, and Gumi, North Gyeongsang Province, reached the RE100 target that year.
sahn@heraldcorp.com
