ILMA Compoundings – November 2019 - 16

In April 2018, the International Maritime Organization
(IMO) issued its greenhouse gas strategy, which called
for a 50% reduction in emissions by 2050. While many
experts consider achieving that goal a long shot, Maersk
anted up, challenging the industry to go completely
carbon neutral by 2050.
Maersk admits it's a lofty goal and one the shipping companies cannot tackle alone. It was a challenge not just to its peers,
but to everyone in the supply chain - shipbuilders, engine
manufacturers, fuel suppliers and the lubricants industry.
Shipping accounts for up to 3% of global emissions and
10% of transport emissions, and it is the mode of transport
for 80% of the world's trade in physical goods. Emissions are
expected to rise by between 50% and 250% by 2050, according
to the Organisation for Economic Co-operation and Development, if the industry does nothing to improve the situation.
It's not just corporate social responsibility around climate
change that is driving this move by some shipping companies to make significant changes. Pressure in the form
of regulations from outside interests such as the IMO and
Environmental Protection Agency is also a driver.
This year, however, perhaps the most critical player came
on board - the banking industry. This past summer, 11
major banks with significant holdings in the global shipping
industry signed on to the Poseidon Principles, which establish a framework for assessing and disclosing the climate
alignment of ship finance portfolios.
"As banks, we recognize that our role in the shipping industry
enables us to promote responsible environmental stewardship
throughout the global maritime value chain," said Michael
Parker, global industry head of shipping and logistics at Citi
and chair of the Poseidon Principles drafting committee. "The
Poseidon Principles will not only serve our institutions to
improve decision-making at a strategic level, but will also shape
a better future for the shipping industry and our society."
The CDP, a charitable organization that runs the global
disclosure system that enables companies, cities, states and
regions to measure and manage their environmental impacts,

16

NOVEMBER 2019

| COMPOUNDINGS | ILMA.ORG

Photo courtesy of Maersk

INDUSTRY RUNDOWN

Maersk Challenges
Shipping Industry to Go
Carbon Neutral by 2050

Maersk says the entire supply chain must work together to achieve carbon-neutrality goals.

thinks this move by banks will have a significant effect as
shipping is a sector mainly financed by debt.
The CDP has been advocating change for years, but its
message has had little impact. In a recent report, A Sea
Change, the CDP said that shipping companies are failing to
push for technology that will result in zero-carbon emissions.
Even things as simple as going slow, which the CDP admits is
a short-term solution, would reduce emissions by 30%. Only
13 of 18 companies analyzed have slow-steaming policies.
Incremental changes will not get the industry where it
needs to be, and the CDP is pushing for huge leaps in technology. So far, according to the CDP, only three companies
- NYK, Norden and Maersk - are developing industry-transforming technology. While Maersk and Norden are
looking at second-generation biofuels, NYK is pushing a
zero-emission vessel by 2050.
Whatever technique is used to get them there, the entire
industry must work together to crack the code. Søren Toft,
chief operating officer of AP Møller-Maersk, feels the same
way as the CDP, saying that "unparalleled innovation" is
needed - now.
"A modern ship is a highly capital-intensive asset with a
typical life span of 25 to 30 years," Toft told Forbes. "To
deliver on ambitious climate targets, zero-emission vessels
will need to enter the fleet by 2030. This leaves us only 10
years to develop the new marine fuels, propulsion technologies and infrastructures that will be required."


http://www.ILMA.ORG

ILMA Compoundings – November 2019

Table of Contents for the Digital Edition of ILMA Compoundings – November 2019

LETTER FROM THE CEO
INSIDE ILMA
WHAT’S COMING UP
INDUSTRY RUNDOWN
In the Know
International Insight
Market Report
STRATEGIES FOR THE FUTURE
ENGAGED AND AWARE
BEHIND THE SCENES
BUSINESS HUB
COUNSEL COMPOUND
WASHINGTON LANDSCAPE
IN NETWORK
Member Connections
PORTRAIT
ILMA Compoundings – November 2019 - Cover1
ILMA Compoundings – November 2019 - Cover2
ILMA Compoundings – November 2019 - 1
ILMA Compoundings – November 2019 - 2
ILMA Compoundings – November 2019 - LETTER FROM THE CEO
ILMA Compoundings – November 2019 - INSIDE ILMA
ILMA Compoundings – November 2019 - 5
ILMA Compoundings – November 2019 - 6
ILMA Compoundings – November 2019 - 7
ILMA Compoundings – November 2019 - 8
ILMA Compoundings – November 2019 - 9
ILMA Compoundings – November 2019 - 10
ILMA Compoundings – November 2019 - 11
ILMA Compoundings – November 2019 - WHAT’S COMING UP
ILMA Compoundings – November 2019 - 13
ILMA Compoundings – November 2019 - 14
ILMA Compoundings – November 2019 - 15
ILMA Compoundings – November 2019 - INDUSTRY RUNDOWN
ILMA Compoundings – November 2019 - 17
ILMA Compoundings – November 2019 - 18
ILMA Compoundings – November 2019 - In the Know
ILMA Compoundings – November 2019 - International Insight
ILMA Compoundings – November 2019 - 21
ILMA Compoundings – November 2019 - Market Report
ILMA Compoundings – November 2019 - 23
ILMA Compoundings – November 2019 - STRATEGIES FOR THE FUTURE
ILMA Compoundings – November 2019 - 25
ILMA Compoundings – November 2019 - 26
ILMA Compoundings – November 2019 - 27
ILMA Compoundings – November 2019 - 28
ILMA Compoundings – November 2019 - 29
ILMA Compoundings – November 2019 - 30
ILMA Compoundings – November 2019 - 31
ILMA Compoundings – November 2019 - ENGAGED AND AWARE
ILMA Compoundings – November 2019 - 33
ILMA Compoundings – November 2019 - 34
ILMA Compoundings – November 2019 - 35
ILMA Compoundings – November 2019 - BEHIND THE SCENES
ILMA Compoundings – November 2019 - 37
ILMA Compoundings – November 2019 - 38
ILMA Compoundings – November 2019 - 39
ILMA Compoundings – November 2019 - BUSINESS HUB
ILMA Compoundings – November 2019 - 41
ILMA Compoundings – November 2019 - COUNSEL COMPOUND
ILMA Compoundings – November 2019 - 43
ILMA Compoundings – November 2019 - 44
ILMA Compoundings – November 2019 - WASHINGTON LANDSCAPE
ILMA Compoundings – November 2019 - Member Connections
ILMA Compoundings – November 2019 - 47
ILMA Compoundings – November 2019 - PORTRAIT
ILMA Compoundings – November 2019 - 49
ILMA Compoundings – November 2019 - Cover4
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