London - Many of the world’s biggest lenders to shipping companies fell short of carbon-cutting targets last year in the first analysis of CO2 goals for the sector by financiers, a report showed on Wednesday.
Global shipping accounts for nearly 3% of the world’s CO2 emissions and the industry is under pressure to reduce those emissions and other pollution. About 90% of world trade is transported by sea.
Last year, a group of leading banks signed up to environmental commitments known as the Poseidon Principles, whereby financiers take account of efforts to cut CO2 emissions when providing loans to shipping companies.
The principles establish a common baseline to assess whether lending portfolios are in line or behind the climate goals set by the U.N. shipping agency, the International Maritime Organization (IMO).
In the first climate assessment report issued by the signatories, which includes emissions data collected from borrowers, just three of 15 financiers - Bpifrance Assurance Export, Export Credit Norway and ING - were aligned with IMO decarbonisation targets in 2019.
“This is not about comparative scoring but taking portfolios as existed at the end of 2019 and creating a starting point for each signatory to improve or get into alignment by taking the relevant decisions on the new business they do,” Michael Parker, chairman of Citi’s global shipping, logistics and offshore business, told Reuters.