Financial stakeholders are key to shipping’s green transition

This piece originally appeared in Nordea’s Open Insights blog prior to the Nordea Sustainable Finance and Shipping Forum. Watch the event recording here.

Shipping is one of the lowest emission-intensive modes of transporting goods, compared to, for example, trucking or aviation. However, accounting for around 80% of world trade, the shipping industry is also among the largest carbon emitters, with over one billion tons of greenhouse gas emissions each year, similar to the total carbon emissions of Germany. Such emissions are expected to grow by 50-250% by 2050 if left unchecked.

While the industry has largely been out of sight and out of mind, that’s changing, according to Andrew Stephens, Executive Director at the Sustainable Shipping Initiative (SSI). Demand-side stakeholders, including civil society, lenders, investors and cargo holders, are exerting more pressure on the industry to reduce its environmental impact and improve its sustainability performance.

What are the biggest challenges in the shipping sector when it comes to becoming more sustainable?

Transparency. More is happening in the way the industry operates, for example through decarbonisation, where emission targets, regulatory requirements and demand from financial stakeholders and customers are paving the way to more disclosure and transparency. But how is reporting done, and how credible is it? Is it voluntary, and is it verified by any external authorities, bodies or agents?

Historically, shipping has been resistant to sharing information for fear of it being used in a competitive way, even if not proprietary. Transparency thus remains a challenge, but it is trending upwards, with more demand for data enabling stakeholders to make informed decisions around sustainability performance.

Financial institutions are leading the way forward with, for example, the Poseidon Principles, through which they disclose data on the climate alignment of their shipping portfolios.

Where is the most progress being made?

Right now, progress is focused on the decarbonisation front. That’s where we see real discourse, action and collaboration between public and private sectors. There’s a hunger for rapid decarbonisation and a need for stakeholders to work together on this problem – it will not be fixed by one group alone.

The discussion at the moment is focused on alternative fuels and technologies for decarbonisation, which SSI is working on as a knowledge partner of the Fuels & Technologies workstream of the Getting to Zero Coalition. Additionally, the sustainability credentials of these fuels are also a key issue under consideration, ensuring that, for example, hydrogen and ammonia are derived from sustainable sources. The breakthroughs are there from a technical perspective, but it’s the scaling up and the upstream infrastructure that need addressing.

This presents an opportunity for finance to enable and support shipping’s transition to zero (or low) carbon fuels such as green hydrogen or green ammonia from wind and solar.

What role do you see sustainable finance playing in the transition?

Financial market actors are among the key stakeholders and levers for driving progress in the industry. They have a significant influence across the shipping value chain in terms of being able to demand action.

The levers are both carrot and stick. Some banks have taken the stick approach of removing poor performers or sectors not in line with certain policies or positions. The alternative approach is to partner with the elements of an industry to not just agree on incentives, which could be preferential loans or rates based on good performance, but to also play a key role in sharing and inspiring how it can be done.

The Climate Bonds Initiative has launched criteria to steer investments in the shipping industry, rewarding those not carrying fossil fuels and those operating zero-emission vessels or targeting to become zero-emission. And it’s not just about ship owners. Charterers are also helping to drive the requirements for low-carbon initiatives through the supply chain, having those requirements put into their contracts and reporting on that. The more these initiatives are shared across the value chain and incentive-driven, the more they will be taken up.

Making the shipping industry more sustainable is a collective challenge, requiring engagement from all actors across the value chain – whether it’s decarbonisation, responsible ship recycling, or safeguarding labour and human rights for seafarers and other shipping workers. Finance has the power to provide guidance and support, sharing its knowledge of what is possible and partnering with the industry to bring about positive change.


Wilhelmsen Ship Management becomes a member of the Sustainable Shipping Initiative

LONDON, 19 January 2021 – The Sustainable Shipping Initiative (SSI) today announces its newest member, Wilhelmsen Ship Management.

Wilhelmsen Ship Management (WSM) is a provider of third-party ship management services, providing technical and crew management services for various vessel segments: LNG/LPG, Ro-Ro and PCC/PCTC, Bulk, Container, Cruise and Offshore.

They join fourteen members spanning the shipping value chain: ABN Amro, Bunge, Forum for the Future, IMC Industrial Group, Lloyd’s Register, Louis Dreyfus Company, Maersk, Oldendorff Carriers, Priya Blue, RightShip, The China Navigation Company, South32, Standard Chartered Bank, and WWF.

SSI brings together like-minded, leading organisations with shared goals and determination to improve the shipping industry. Members, ranging from shipowners and charterers, to environmental NGOs, banks, service providers and classification societies, work together toward the milestones laid out in the Roadmap to a sustainable shipping industry.

Wilhelmsen Ship Management is committed to operating responsibly and making a positive contribution to society and the environment. The Singapore based ship manager has a progressive aim to incorporate the elements of People, Environment, Trade and Customer into the heart of ship management operations. As a member, Wilhelmsen Ship Management will participate in working groups on issues relevant to the Roadmap’s six vision areas: Oceans, Communities, People, Transparency, Finance, and Energy.

“We look forward to deepening our sustainability priorities and making a bigger impact through the SSI platform. We hope to work collectively together with other forward leaning members in SSI to impart values in the shipping industry.” says Carl Schou, CEO and President of Wilhelmsen Ship Management.

SSI Executive Director Andrew Stephens said: “On behalf of SSI and its members, I am pleased to welcome Wilhelmsen Ship Management to the family. The sustainability challenges facing the shipping industry, from decarbonisation to seafarers’ rights, transparency and healthy oceans, must be collectively addressed across the value chain. The unique perspective WSM brings as a ship management company will further diversify the SSI membership, helping us ensure representation of the entire shipping value chain in our work.”

- ENDS -

 

Notes to Editors

For more information, interviews or comment please contact Elizabeth Petit, Head of Communications, Sustainable Shipping Initiative (e.petit@sustainableshipping.org) or Esther Gan, Vice President of Marketing & Communication, Wilhelmsen Ship Management (esther.gan@wilhelmsen.com).

About the Sustainable Shipping Initiative

The Sustainable Shipping Initiative (SSI) is a multi-stakeholder collective of ambitious and like-minded leaders, driving change through cross-sectoral collaboration to contribute to – and thrive in – a more sustainable maritime industry. Spanning the entire shipping value chain, SSI members are shipowners and charterers; shipyards, marine product, equipment and service providers; banks, ship finance and insurance providers; classification societies; and sustainability non-profit organisations.

www.sustainableshipping.org | @SustShipping

About Wilhelmsen Ship Management

Wilhelmsen Ship Management, a Wilhelmsen group company, is one of the world’s largest third-party ship manager with a portfolio of more than 450 vessels and 9 200 active seafarers. Wilhelmsen Ship Management provides technical and crew management services for various vessel segments; LNG/LPG, Ro-Ro and PCC/PCTC, Container, Cruise, Bulk, and Offshore. Wilhelmsen Ship Management manages from six offices worldwide and has a crewing network of 16 manning offices in 12 countries. Other key services include dry docking services, lay-up services and new building supervision.

 

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Roadmap featured in Lloyd's Register Horizons December issue

This piece originally appeared in the December issue of Lloyd’s Register Horizons. The full issue can be downloaded here.

The sustainable road ahead


Shipping faces major global challenges: from a changing social and volatile economic context; to increased demand for transparency from customers through to investors; to the climate crisis and the need for rapid decarbonisation. These challenges coupled with industry trends will reshape the industry, while bringing opportunities across and beyond the shipping value chain.

The future is never certain – 2020 has been a case in point – but a strong plan can help underpin one’s ambitions. This is particularly true for the global drive on sustainability and all sectors – marine and offshore included – stand to benefit from clear objectives on how to get there.

Developed by members of the Sustainable Shipping Initiative (SSI), the Roadmap to a sustainable shipping industry lays out the pathways and defines tangible milestones to be collectively achieved for a sustainable and successful shipping industry.

The Roadmap consists of six vision areas – Oceans, Communities, People, Transparency, Finance, and Energy – each with its own set of objectives and interrelated milestones to be attained along the industry’s sustainability journey over the coming decades.

It is a resource for stakeholders across the shipping value chain, to be used by companies and organisations to identify and understand their present and future sustainability challenges, as well as the steps and milestones to overcome them. The Roadmap deepens individual and collective understanding of sustainability barriers and opportunities and empowers stakeholders to find innovative solutions.

A roadmap for the shipping industry, by the industry

The Roadmap was initially developed in 2016 as a way to provide an overview of the defining factors, milestones, and priorities needed to achieve a sustainable shipping industry. SSI members identified global challenges and trends expected to affect the industry, publishing the Roadmap as a call to action and kickstarting the debate on how the industry would respond.

In light of rapid and complex changes since its launch, SSI commissioned Lloyd’s Register (in collaboration with SSI members) to review progress against the Roadmap in the first half of 2020. Consisting of a desktop review, expert interviews and stakeholder consultations, the review considered changes in the industry landscape, highlighting progress and identifying gaps. The update process resulted in the consolidation and review of milestones to ensure their ongoing relevance and robustness as indicators of industry progress.

A living document

While we are confident that the outcomes of the recent review will resonate with many, we know that for the Roadmap to remain relevant and track how shipping moves further along in its sustainability journey, it must be a working tool for every stakeholder across the value chain.

As a living document, the Roadmap will continue to evolve with the industry, celebrating successes, pausing for reflection and identifying areas where further work needs to be done. Through a periodic review and update process led by the SSI in consultation with industry stakeholders, we will ensure that progress against the vision areas and milestones is tracked while also capturing changes in the landscape.

But we need your help to do this. Enable us to track industry progress by sharing what you are doing for a sustainable shipping industry.


Lloyd's Register Horizons: Roadmap Feature

Following the launch of the updated Roadmap to a sustainable shipping industry, SSI wrote a piece in the December issue of Lloyd’s Register quarterly magazine, Horizons.

Featuring quotes from SSI’s members and explaining in further detail the six vision areas and changes to the updated Roadmap, this piece serves as a useful introduction to the key opportunities and barriers to a sustainable shipping industry.

The Roadmap feature can be seen below. The full issue of Horizons can be downloaded here.

Click to download

SSI announces Guy Campbell as new Chair of Board of Trustees

LONDON, 8 December 2020 – The Sustainable Shipping Initiative (SSI) today announces the appointment of Guy Campbell as new Chair of SSI’s Board of Trustees, replacing Stephanie Draper, who stepped down in September 2020.

Stephanie played a key role in the SSI’s founding in 2010 as part of Forum for the Future and went on to become the inaugural Chair of the Board of Trustees in 2013. Stephanie’s commitment to a more sustainable shipping industry has been instrumental in developing SSI as a leading voice in maritime sustainability.

Stephanie Draper said: “The SSI was the first of its kind – breaking new ground in sustainability and shipping – bringing leaders together to define what is needed. I am proud of what the SSI has achieved – from a roadmap to sustainability, new financial models for energy efficient retrofit, and practical ways to recycle ships. It is great to hand over the Chair to Guy at a time when SSI is going from strength to strength. He will benefit from an amazing team – Andrew, Nicole, Elizabeth and Andreea – and a really committed Board – thanks to both of them for all they have done for sustainability.”

This year marks SSI’s 10-year anniversary, and as we reflect on our history and ambitions for the coming decade, we are glad to welcome Guy Campbell as Chair to provide expert guidance and contribute to the initiative’s further development, as well as our ongoing work in the areas of decarbonisation, ship recycling and seafarers’ rights.

Guy Campbell joined SSI’s Board of Trustees in June 2020 and has worked closely with Co-Chair Alastair Fischbacher and the SSI Secretariat to gain a deep understanding of SSI’s work, objectives and capabilities. Guy brings 30 years of experience in the dry cargo sector, as broker, charterer, freight trader and currently General Manager (Atlantic), Swire Bulk, the bulk carrier owning and operating division of The China Navigation Company. He is a part time arbitrator and was Chairman of The Baltic Exchange 2014-16.

Guy Campbell said: “Joining SSI is an exciting opportunity to contribute to the shipping industry at such a significant time. I look forward to working with the Board and Secretariat, supporting SSI’s ongoing and future activities on key issues including decarbonisation, seafarers’ rights and ship recycling. I will work to ensure that SSI’s work, values and message reach decision makers and drive concrete action on the operational side of our industry.”

Co-Chair Alastair Fischbacher said: “The board undertook a detailed and rigorous process to ensure that we found someone who understood both SSI’s history and its ambitions for the future, and we are delighted to welcome Guy as Chair. Over the past six months the SSI team, Stephanie and I have worked with Guy to ensure a smooth transition; I very much look forward to working together with him to ensure the SSI continues to lead the shipping industry towards a truly sustainable future.”

2020 has also seen the appointment of A.P. Moller-Maersk’s Jacob Sterling and Forum for the Future’s Oriana Brine to the SSI Board of Trustees.


Oriana Brine

Oriana Brine


Independent Trustee

Oriana Brine is Associate Director, Sustainability at the global creative agency MullenLowe salt, and works with clients to catalyse purposeful yet credible corporate sustainability strategy and communications. She has spent over a decade working on sustainability issues in the food, energy, and supply chain industries in Asia Pacific. Her previous role was at leading international NGO Forum for the Future where she worked with companies such as Dole, China Navigation (Swire Group), Zespri, Unilever, Air New Zealand and Oxfam on solving complex climate change, biodiversity, and supply chain challenges.

Oriana is based in Singapore, the hub for accelerating the transition to a more sustainable future in Asia. She holds a Master of Science from the University of Auckland, specialising in marine biodiversity and a Bachelor of Science in Biology and Chemistry from the University of Waikato.


Webinar: Sustainability criteria for marine fuels

On 24 November 2020 SSI co-hosted a webinar in collaboration with the Getting To Zero Coalition. The discussion explored the sustainability issues surrounding marine fuels, contributing to the broader debate on incentivising and enabling the uptake of sustainable marine fuels, as well as informing decision-making around the choice of fuel(s) to promote, invest in and use.

Managing supply chain risks of marine fuels requires an understanding of the sustainability issues from a full lifecycle perspective, i.e. well-to-wake. Once these are understood and sustainability criteria defined, industry standards can be set and certification programmes can be put in place to assure the sustainability of marine fuels.

Moderator: Randall Krantz, Senior Project Advisor on Decarbonizing Shipping, Global Maritime Forum

Panelists:

  • Simon Bennett, General Manager – Sustainable Development, The China Navigation Company
  • Trevor Brown, Executive Director, Ammonia Energy Association
  • Mark Lutes, Senior Advisor, Global Climate Policy, WWF Climate and Energy Practice
  • Katharine Palmer, Global Sustainability Manager, Marine & Offshore, Lloyd’s Register


SSI Impact: News from our journey to sustainable shipping - 04/2020

The SSI Newsletter is published quarterly and is the place to find news from the SSI community, our partners and the impact of our collective work along our journey to a sustainable shipping industry.

Subscribe to SSI Impact: News from our journey to sustainable shipping


Lloyd's Register Report - Roadmap review

In October 2018 SSI members agreed that a comprehensive review and update of the Roadmap to a sustainable shipping industry was needed to ensure the relevance and robustness of the milestones against which industry progress can be tracked.

Throughout 2019-20, Lloyd’s Register was commissioned to conduct a thorough review of the Roadmap, resulting in a report that highlighted progress, identified gaps and pointed to areas where more action is needed to overcome shared barriers. Published in June 2020, the report designates Red Amber Green (RAG) status to indicate the progress made against the original Roadmap’s milestones, providing evidence and making recommendations for the updated Roadmap launched in December 2020.

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SSI launches updated Roadmap to a sustainable shipping industry to guide shipping throughout its sustainability journey

LONDON, 2 December 2020 – The Sustainable Shipping Initiative (SSI) announces the launch of the updated Roadmap to a sustainable shipping industry, a resource for stakeholders across the shipping value chain to navigate the major, pressing sustainability challenges facing the industry.

There is a clear need to reshape the way shipping operates in the face of current and future challenges: from a changing climate and the need for rapid decarbonisation by 2050; to increased scrutiny and pressure from investors, lenders and other financial stakeholders to improve sustainability performance and reporting; to the labour and human rights risks faced by seafarers worldwide, and highlighted by the ongoing crew change crisis.

Consisting of six vision areas – Oceans, Communities, People, Transparency, Finance, and Energy – each aligned with the Sustainable Development Goals and with its own set of objectives and interrelated milestones, the Roadmap sets out opportunities for positive impact across and beyond the shipping value chain.

Companies and organisations can use the Roadmap’s 60 milestones as indicators against which they report and track progress of their respective sustainability journeys.

Developed by members of the Sustainable Shipping Initiative with review and feedback from industry, the Roadmap deepens our individual and collective understanding of the barriers and opportunities, creating a common language and purpose for a sustainable, successful shipping industry.

Initially launched in 2016, the Roadmap was updated in 2020 to reflect the continuous changes in the maritime landscape and ensure its ongoing relevance. The updated Roadmap is a call to action, increasing ambition to respond to the global challenges and trends expected to affect the industry in the coming decades.

SSI Executive Director Andrew Stephens said: “The Roadmap to a sustainable shipping industry shows us what sustainable shipping looks like, highlighting how we as an industry can play our part in the achievement of the Sustainable Development Goals. From ocean governance; to port and coastal communities; seafarers and shipping workers; transparency and accountability; financial solutions to enable maritime innovation; to the radical decarbonisation of shipping - all of these elements are key in our collective journey to a sustainable and successful maritime industry.

The Roadmap is a tool for the industry to rally around and against which we can hold ourselves accountable. We hope all stakeholders engaged across the shipping value chain, will find the Roadmap useful and reflect on the pathways that we can individually and collectively contribute to, navigating to sustainable shipping in the months, years, and decades to come.”

Help us track progress by sharing what you are doing for sustainable shipping at www.sustainableshipping.org/roadmap/

– ENDS –

 

Quotes from SSI member representatives:

Jacob Sterling, Head of Technical Innovation, A.P. Moller Maersk: “At Maersk we believe in taking responsibility through collective action when it comes to pursuing solutions to contribute to the SDGs. We’re committed to maximising the positive, and mitigating the negative impacts across our operations – ranging from the full decarbonisation of our shipping operations to improving ship recycling.

The Roadmap to a sustainable shipping industry provides a unique and ambitious overview of the milestones and priorities for us and our peers across the maritime sector, driving shipping’s sustainability journey in the decades to come.”

Oriana Brine, Senior Strategist, Forum for the Future: “The unprecedented system shock to the shipping industry this year underlines the urgent need for fundamental change to create a more resilient, future-fit sector that contributes to a regenerative and just society. We welcome this Roadmap as a holistic tool to drive this transformation, laying out the actions required for stakeholders in the shipping value chain to help achieve the UN’s SDGs, and offering clear milestones against which to track the industry’s progress towards these goals.”

Katharine Palmer, Global Head of Sustainability, Lloyd’s Register: “We’re proud to support SSI with updating its sustainability roadmap in line with recent developments in maritime, ensuring its relevance as we move towards to a zero-carbon future. The roadmap is an important tool for both the shipping industry and individual organisations, setting out milestones that cover all aspects of social, environmental and economic sustainability, helping businesses develop their own journeys: focusing on where they can contribute positively. The SSI roadmap also translates the UN’s SDGs into what sustainability means for shipping.”

Sebastien Landerretche, Head of Freight Platform, Louis Dreyfus Company: “As a member of SSI, Louis Dreyfus Company is very pleased to see the launch of the updated Roadmap to a sustainable shipping industry. We believe this will be a key resource and guide, for us and for other industry participants and stakeholders, as we work together toward our common goal to reduce shipping-related emissions and protect human rights.”

Robert Haggquist, Charterer, South32: “At South32, working with communities is a core part of who we are and what we do. We believe that by working in partnership with our communities we can understand our environmental impact and only by working together can we achieve long-term social, environmental and economic outcomes. It’s this strong foundation between industry stakeholders and communities that is vital, indeed essential, to achieve the milestones set out in the Roadmap.

We are proud to contribute to this Roadmap, which sets out the milestones that the maritime sector must achieve across six vision areas in the decades to come, helping us extend our emphasis on local and indigenous communities beyond land-based supply chains and into our shipping operations.”

Roger Charles, Executive Director, Environmental and Social Risk Management, Standard Chartered Bank: “Shipping’s sustainability journey presents an opportunity for financial institutions to get involved and drive changes in the global fleet by supporting R&D and the development of operational and technological improvements.

Beyond the investment needed for the rapid decarbonisation of the industry, banks, investors, insurance providers and others must also consider what sustainable investment means in a broader maritime context – using concepts like the blue economy and tools like this roadmap to guide thinking in this area.”

Simon Bennett, General Manager – Sustainable Development, The China Navigation Company: “The China Navigation Company is committed to making the shipping value chain sustainable. As founding members of the Sustainable Shipping Initiative, we’ve worked alongside industry leaders for the past ten years, united by a common goal of collective action and transparency to not only contribute to, but also assist a sustainable and successful maritime sector to thrive.

Stakeholders across and beyond the physical and economic lifecycle of ships must work to coalesce and align on sustainable solutions to help us achieve the milestones featured in this latest iteration of our Roadmap (and as early as possible). We must all act now, and act together, to tackle the diverse challenges facing the sector in the coming decades and contribute to progressing the global sustainability agenda.”

Mark Lutes, Senior Advisor, Global Climate Policy, WWF Global Climate and Energy Practice: “The decarbonisation of the shipping industry is essential to ensure the world achieves the Paris Agreement goal to limit global warming to 1.5˚C. While the level of climate ambition needed from the sector has not yet materialised, there are voices in the sector, like the Sustainable Shipping Initiative, actively calling for comprehensive climate action on several fronts. It gives hope that the shipping sector will, sooner rather than later, move decisively to decarbonize by 2050 as climate scientists have told us we must.”

 

Notes to Editors

For more information, interviews or comment please contact Elizabeth Petit, Head of Communications, Sustainable Shipping Initiative (e.petit@sustainableshipping.org).

 

About the Sustainable Shipping Initiative

The Sustainable Shipping Initiative (SSI) is a multi-stakeholder collective of ambitious and like-minded leaders, driving change through cross-sectoral collaboration to contribute to – and thrive in – a more sustainable maritime industry. Spanning the entire shipping value chain, SSI members are shipowners and charterers; shipyards, marine product, equipment and service providers; banks, ship finance and insurance providers; classification societies; and sustainability non-profit organisations.

www.sustainableshipping.org | @SustShipping

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