Loan whose pricing terms include interest-rate step-ups or step-downs tied to the borrower's achievement of specified ESG KPIs — most commonly emissions-intensity reduction, diversity metrics, or safety targets. Typical mechanic: -10 bps coupon reduction if emissions intensity reduces by 20%, +10 bps step-up if KPI is missed. Distinct from green loans (use-of-proceeds-restricted financing); SLLs are general-purpose loans with pricing tied to performance. Increasingly common in middle-market and infrastructure PE deals as ESG diligence and reporting become standardized. The pricing impact is typically small (±10-25 bps) but creates a measurable GP commitment to KPI achievement and ESG reporting discipline.