After months of speculation a group of 11 major banks engaged in ship finance have launched a set of principles outlining the climate -focused considerations they will make with their future investments.
The 11 banks, which includes Citi, Societe Generale, DNB say ina press release they represent $100bn in loans and will align their portfolios with the target of reducing shipping’s carbon emissions by 2050 by 50%.
These principals are to be known as the Poseidon Principles, and seen as a global framework for assessing and disclosing the climate alignment of financial institutions’ shipping portfolios. One of the main supporters backing this move by financial institutions is Michael Parker Global Industry Head of Shipping & Logistics at Citi and Chair of the Poseidon Principles drafting committee.
In a statement he said that the 11 banks recognise the influence they have in the shipping industry which enables them to promote responsible environmental stewardship .
“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”, he is quoted as saying.
The 11 banks say The Poseidon Principles establish” a common baseline to quantitatively assess and disclose whether financial institutions’ lending portfolios are in line with adopted climate goals.”
“We encourage all our colleagues to join us in leading industry-wide change by becoming Signatories of the Poseidon Principles”, says Kristin Holth, Executive Vice President, Global Head of Ocean Industries at DNB and member of the Poseidon Principles drafting committee.
“Urgent action is needed to advance maritime shipping’s decarbonization. The Poseidon Principles are a groundbreaking achievement that will help ensure shipping remains a foundational component of our global economy. The Principles also represent a leading example for other sectors to follow into the low carbon future”, says Jules Kortenhorst, CEO of Rocky Mountain Institute.
Founding Signatories include Citi, Societe Generale, DNB, ABN Amro, Amsterdam Trade Bank, Credit Agricole CIB, Danish Ship Finance, Danske Bank, DVB, ING and Nordea, and represent around 20% of the global ship finance portfolio.
The Principles were developed in an effort spearheaded by global shipping banks – Citi, Societe Generale, and DNB – and leading industry players – A.P. Møller Mærsk, Cargill, Euronav, Lloyd’s Register and Watson Farley & Williams – with expert support provided by the Global Maritime Forum, Rocky Mountain Institute and University College London Energy Institute.