At least one share buyback from penmaker Societe BIC next year is set to help fund education, marking one of the latest ways to fuse corporate sustainability efforts with regular financial business.
Clichy, France-based BIC, known for its stationery, lighters and shavers, said Thursday that it would donate some funds from an upcoming share buyback to the BIC Corporate Foundation for Education and J-Pal, a nonprofit research center focused on education issues such as reducing school dropout rates. BIC said the program is the first of its kind in Europe.
Share buybacks cut the amount of outstanding stock in a company, driving up earnings per share and potentially boosting stock prices. BIC said it would donate the outperformance of its future buyback, measured as the difference between what the company buys the stocks for and the average price of its shares throughout the trading day under the volume weighted average price metric.
Depending on market conditions, BIC said it would execute the program next year and provide more details on the buyback's size and duration in early 2021.
"We really hope that it is the first, but it is the first among many others and many companies will follow that trend," said Sophie Palliez-Capian, vice president for corporate stakeholder engagement at BIC, in an interview.
She said she hasn't heard any feedback from investors yet, but expects the program to be welcomed since it creates value for both shareholders and stakeholders, including customers and other communities outside the company.
BIC brought in investment house Exane BNP Paribas to help manage the program, which Ms. Palliez-Capian said pitched BIC the idea in October that later won approval from the board.
Earlier this year, Italian power grid operator Terna Rete Elettrica Nazionale SpA also enlisted Exane BNP Paribas on an environmental, social and governance-linked share buyback program to support reforestation projects and "green areas" in Italy.
Write to Dieter Holger at dieter.holger@wsj.com; @dieterholger
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