Intesa Sanpaolo has cemented an innovative new deal with Pirelli, lending €200m to the tyre-maker under strict Circular Economy conditions. The loan was part of a wider €800m sustainability loan taken out by the company and marked a new way of working for both businesses.

In this episode of Intesa Sanpaolo Talks, we explore how – as a lender – Intesa Sanpaolo can help speed up the transformation to a global Circular Economy.

“We adopt an eco-design approach to innovate our products, considering all phases of the tyres and their lifecycle,” says Vincenzo de Cesaris, head of finance at Pirelli, who signed the deal on its behalf. “It’s a continuous theme that we have to innovate and turn challenges into business opportunities.”

The deal, signed in April 2020, requires strict adherence to circular processes. It obliges Intesa Sanpaolo to have a more intimate relationship with Pirelli – knowing much more about the company’s internal processes to ensure they are compliant with the terms of the loan and that no greenwashing is taking place.

For Fabio Matti, head of automotive and industrials at Intesa Sanpaolo, it’s the first step on a long road to changing the nature of lending to business – one that could have real impact in terms of ESG goals.

“It is time for the brown economy to leave the floor to the green one,” says Matti. “There is a lot more to do and we hope that in the future, we will be able to drive more active change by adding other key metrics, for example, de-rating. If we can change our rating based on how much a company is ESG compliant or Circular-Economy compliant, this would be a further step up.”

Massimiano Tellini, head of Circular Economy at Intesa Sanpaolo’s Innovation Center, believes that adopting circular practices will make companies more resilient and so less exposed to risk. “Being reliable, being sustainable, being circular — even more than sustainable — can really make companies more future-proof. And so they can become less risky,” he says