Recently, 11 major banks joined shipping leaders in signing on to the Poseidon Principles, which will help to support the shipping industry’s initiative to reduce carbon emissions by 50% by 2050. The eleven banks include Amsterdam Trade Bank, ABN Amro, and ING.
Dutch banks are industry leaders in climate change initiatives, and most have taken the unique step in writing it into the banks’ corporate strategy. Together, the eleven banks that also include several Nordic based financial institutions, hold a global shipping loan portfolio of about $100 billion.
The Poseidon Principles establish a way to assess and disclose whether financial institutions’ lending portfolios are in line with adopted climate goals. According to an ING press release, “Banks will implement them via internal policies, procedures and standards and will apply them in all credit products secured by ships that fall under the purview of the International Maritime Organisation (IMO), an agency of the United Nations that regulates shipping.”
Amsterdam Trade Bank, leaders in financing shipping businesses and initiatives, stated in its announcement, “Today, we commit to the Poseidon Principles, to protecting our seas and our environment. We rise up to the challenge and take action to move our client’s business forward. It is the right thing to do. We will adapt our business, we will help our clients, and together succeed.”
Stephen Fewster, global head of Shipping Finance at ING: “Banks have an important role to play in promoting sustainable development. The Poseidon Principles fit perfectly with our Terra approach, our strategy to steer our portfolio towards the Paris Agreement’s well-below two-degree goal. The Principles will be integrated into this approach to support our ambition. It’s encouraging to see so many banks collaborate for a low-carbon future and we are delighted to be part of this important initiative.”
Notably, Citi has also signed on to the initiative while most of the top global banks have not. Ship owners, charters and classifications societies were all involved in the writing of the principles. The banks make up about 20% of the financing of the industry. The Principles are inspired by the initial greenhouse gas (GHG) strategy of April 2018 by member states of the IMO that also state the 50% decrease by 2050.
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