NEW YORK: July 03, 2019. A new report by Moody’s Analytics underscores the latest Intergovernmental Panel on Climate Change conclusion that rising global temperatures caused by human activity will lead to economic damage of US$54 trillion in 2100 under a warming scenario of 1.5°C, and US$69 trillion under a warming scenario of 2°C.
In response, ING is one of 11 banks that have launched the Poseidon Principles to support the shipping industry’s reduction of carbon emissions by 50 percent from a 2008 base line by 2050.
The other banks are Citi, DNB, Danish Ship Finance, Danske Bank, Société Générale, DVB Bank, Nordea, Crédit Agricole, Amsterdam Trade Bank and ABN AMRO. Together they hold US$100 billion in shipping loans, around 20 percent of the global ship finance portfolio.
Developed by the banks, ship owners, charterers and classification societies – with support from the Global Maritime Forum, Rocky Mountain Institute and University College London Energy Institute – the Poseidon Principles establish a way to assess and disclose whether financial institutions’ lending portfolios are in line with adopted climate goals.
“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,” declared Stephen Fewster, global head of Shipping Finance at ING. “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.”
ING says the 11 banks will implement the Principles 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).
“Shipping’s decarbonization will require unparalleled innovation. A modern ship is a highly capital-intensive asset with a typical life span of 25-30 years. To deliver on ambitious climate targets, zero-emission vessels will need to enter the fleet by 2030,” explained Søren Toft, COO of A.P. Møller Mærsk.
“This leaves us only 10 years to develop the new marine fuels, propulsion technologies and infrastructures that will be required. The Poseidon Principles will help us catalyze this transition,” he added.