Cosmetics firm Grupo Boticário secured an award for its unique sustainability-linked bond (SLB) which includes a target tied to developing and sharing innovative 'ethical' testing methods that move the sector away from animal testing.

The BRL2 billion ($388 million) deal included a BRL1.625 billion SLB tranche which includes two targets tied to reducing absolute greenhouse gas (GHG) emissions and advancing ethical innovation practices in the hygiene, personal care and cosmetics sector.

The GHG target is validated by the Science Based Target initiative (SBTi) and commits Boticário to reducing Scope 1 and 2 emissions by 62% by 2034 compared with 2022 levels.

The second target is tied to expanding its ethical safety and efficacy assessment methods – which do not require animal testing – from 55 to 70 by 2030. The target also requires Boticário to make at least 12 of the 15 innovative methods publicly available.

This target explicitly focused on providing a "positive spillover" effect for the wider sector was praised for providing a sustainability catalyst beyond the company itself.

The company was also complimented for its combination of the SLB with a BRL375 million 'use-of-proceeds-like' tranche tied to investments eligible under Eco Invest, a Brazilian government-backed green investment programme. This tranche will be used to finance its Leadership in Energy and Environmental Design (LEED) certified Pouso Alegre manufacturing facility in the Minas Gerais region.