In an exclusive interview to SAFETY4SEA, Georgia Spencer-Rowland, Shipping Policy Manager, ICS, notes that the maritime industry is heading in the right direction in addressing ESG requirements, putting an emphasis on the three dimensions. In that regard, it is important for the industry stakeholders to prioritize materiality assessment in ESG factors and tailor their strategies accordingly, avoiding a one-size-fits-all approach.
Harmonizing voluntary ESG reporting frameworks, especially in shipping, is essential, Georgia highlights, adding that ESG performance is increasingly important in attracting talent, particularly among the younger workforce seeking social and environmental impact. She concludes that ensuring a Just Transition will play a pivotal role in the industry’s capacity to both attract and retain top talent for the workforce.
SAFETY4SEA: When it comes to ESG and sustainability, what are the key priorities on the ICS agenda for the next five years?
Georgia Spencer-Rowland: The next five years will be crucial for the shipping industry as it advances towards the International Maritime Organization’s (IMO) ambitious goals to reach net zero by or around 2050. A key priority here is making sure that our people are prepared for the changing landscape ahead. New fuels and new technologies that are introduced to help reach this 2050 target (with indicative checkpoints for 2030 and 2040 too) will mean seafarers must be equipped with the skills to use and handle them. Without seafarers there is no shipping, so this is being addressed by the industry as a matter of urgency through measures such as the Maritime Just Transition Task Force and the review of the STCW. As we set down this pathway towards decarbonization, another core aim for ICS is to accelerate the adoption of low and zero carbon fuels across the industry. To decarbonize and accelerate the uptake of these new fuels it is essential that we close the price gap between them and conventional fuels, and ensure that new technology to aid our green transition is developed and scaled rapidly. Our industry’s commitment to ambitious decarbonization goals is matched by our focus on increasing diversity, inclusion, accessibility and skills, ensuring a people-focused response to addressing climate change. One key sustainability trend driving maritime will be fostering a Just Transition. This means greening the economy in a way that is as fair and inclusive as possible, creating decent work opportunities.
S4S: Do you believe the maritime industry is moving in the right direction? What do you see as the defining ESG/ sustainability trends driving maritime toward the future?
G.S.R.: The maritime industry is definitely heading in the right direction when it comes to ESG with many shipping companies already working towards fulfilling ESG factors in their business operations. Promoting diversity and inclusion in the workplace, practicing sustainable ship recycling, working towards decreasing greenhouse gas emissions are just a few examples of the work taking place across the industry. But, the shipping industry needs support to be on its way to even greater ESG performance particularly when it comes to fulfilling green factors such as decreased carbon emissions. For example, at the moment, the cost of new green fuels over conventional fuels is much higher. There need to be measures put in place to incentivise and accelerate the uptake of these new green fuels over conventional fuels. Otherwise, we put at risk the speed at which our industry can reduce its greenhouse gas emissions in line with the IMO GHG reduction strategy announced in July – arguably an ESG reporting framework in itself. Many investors also look to a company’s adherence to ESG factors to influence their investment decisions. As a capital intensive industry it is in shipping’s best interests to make sure ESG principles are being put into practice.
S4S: With shipping expected to transport a significant portion of low-carbon fuels by 2050, how does the CEM-Hubs initiative envision the transition to net-zero targets?
G.S.R.: If the world is going to transition to new low- and zero-emission fuels from renewable sources, we need to build a transportation value chain to move the fuels from producers to users, as well as have the infrastructure in place that will enable us to do this. Without the ability to transport the fuels, we will not have the supply to meet demand, and nations will not be able to meet their climate targets. The Clean Energy Marine Hubs (or CEM-Hubs) is a cross-sectoral public-private platform intended to de-risk investments needed to produce low- and zero-emission fuels to be transported by the maritime sector. The aim of the initiative is to become the high-level platform that can catalyze and support the alignment of effort across the energy-maritime value chain. By collaborating across the value chain and with governments this initiative can unlock the production, transportation and use of low-carbon fuels for the world at scale.
S4S: How could industry stakeholders best collaborate in support of sustainable development? Do you have any new projects/ plans with regards to ESG / sustainability?
G.S.R.: When it comes to ESG, collaboration and knowledge sharing is vital. Strides in innovative solutions to environmental, social and governance issues will not have a profound impact if these are not applicable across the entire maritime value chain. Our newly established ICS ESG Working Group brings together a network of sustainability experts from amongst our membership of national shipowner associations to discuss the most pressing sustainability issues affecting maritime transport trade. Sharing knowledge about ESG, sustainability and how best to succeed in a just transition is invaluable to ensuring that our ambitious goals are met. A suite of publications also exist to help shipowners on their ESG journey, produced by the International Chamber of Shipping for the entire shipping industry to use. For example, the Diversity & Inclusion Toolkit, the Cyber Security Workbook, ICS Reducing Greenhouse Gas Emissions: A Guide for IMO Regulatory Compliance – to name just a few. We have done the homework and started to lay the foundations to drive forward work around ESG.
S4S: How does technology play a key role in helping the maritime industry comply with ESG/ sustainability targets?
G.S.R.: Technology is key to unlocking a successful transition but must be available to all. Whether this is innovative solutions for digitizing ESG reporting strategies, or development of new vessel infrastructure which allows for greater environmental efficiency. Without technology and, crucially, investment in innovation, none of these sustainability goals could be achieved. The crucial thing now is that investment in these new technologies is safeguarded. De-risking funding is essential so that all stakeholders in the maritime value chain can find much needed investment for innovative technological sustainability solutions. It is also important to make sure that we account for new technologies in seafarer training to make sure skills keep up with an evolving industry. We are doing this through the work of the Maritime Just Transition Task Force and the STCW review, to make sure seafarer training remains fit for purpose.
S4S: When it comes to ESG reporting, what are the top priorities for industry stakeholders to keep in mind?
G.S.R.: ESG reporting can appear incredibly complex at the best of times, with myriad different approaches, frameworks and standards for reporting about, often, exactly the same data. The priority for industry stakeholders to keep in mind is that: materiality matters. Assessing materiality helps define what ESG means for you and your company, ensuring that businesses can focus on the key ESG factors which most matter most to them, and helps to avoid a ‘one size fits all’ data sharing model. Voluntary ESG reporting frameworks which include shipping have a long way to go to global harmonisation, and in the meantime industry stakeholders must keep in mind that not all environmental, social or governance factors will be equally material for all companies. We also know that ESG performance is increasingly becoming a differentiator in the maritime job market as young people in particular look for greater social and environmental impact in their work. Ensuring a Just Transition will be a driving factor in industry’s ability to continue attracting and retaining the best talent for the workforce.
The views presented are only those of the authors and do not necessarily reflect those of SAFETY4SEA and are for information sharing and discussion purposes only.
