Banking signatories to the Poseidon Principles as well as parties committed to the Poseidon Principles for Marine Insurance are upping their green ambitions meaning shipowners will need to get their net zero credentials spruced up fast.
30 shipping banks and 17 marine insurance providers and brokers said today they would add additional trajectories to report climate alignment with the aim of the UN and the latest available climate science to limit global warming at 1.5C.
“The urgency is clear. Because of the role that shipping plays in the global economy, we must accelerate our ambition towards the Paris Agreement’s 1.5C temperature goal. This new ambition will allow the Poseidon Principles to continue playing our role in incentivising and supporting the decarbonisation of shipping,” said Michael Parker, chairman, global shipping, logistics and offshore at Citi and chair of the Poseidon Principles for Financial Institutions.
The Poseidon Principles are already aligned with the International Maritime Organization’s ambition to reduce GHG emissions from international shipping by at least 50% by 2050. The Poseidon Principles for Marine Insurance also benchmark against an emissions reduction trajectory in line with a 100% reduction by 2050.
The new commitment announced today means that once a new trajectory based on credible and well-recognised sources is established and adopted by the members of the individual initiatives, signatories will benchmark their portfolios against two trajectories: one aligned with the IMO’s 50% reduction by 2050, and one aligned with net-zero by 2050 and a maximum temperature rise of 1.5C above pre-industrial levels by 2100, to meet the temperature goals of the Paris Agreement. For the second trajectory to be consistent with a 1.5C future, the scope will be expanded to include all greenhouse gas species, and to account for well-to-wake emissions.
“Access to real emissions data through the Poseidon Principles creates tangible impact in our business as well as in the real economy. Establishing common global decarbonization trajectories will help us make business decisions that reflect the latest available climate science. This is the right thing for us to do,” added Patrizia Kern-Ferretti of Swiss Re Corporate Solutions and chair of the Poseidon Principles for Marine Insurance.
Also announced today, KfW IPEX-Bank, a major provider of financing for the maritime industry, is the latest financial institution to join the Poseidon Principles framework for responsible ship finance. The Poseidon Principles now collectively cover over 65% of the global ship finance portfolio.