Financiers Report Highlights Progress in Decarbonizing Shipping Finance

The Poseidon Principles, representing nearly 80% of global ship finance, has released its fifth Annual Disclosure Report, showcasing progress towards decarbonized shipping. Financial institutions globally are increasing climate transparency, aligning their portfolios with ambitious decarbonization goals set by the IMO to eliminate emissions from international shipping by 2050. The report highlights the climate alignment of 35 major financial institutions across 14 countries, marking the fifth anniversary of the Poseidon Principles as a pioneering framework for measuring and reporting climate alignment in shipping finance.

Key findings from the 2024 Annual Disclosure Report reveal that transparency is on the rise, with an average of 93.3% of signatories reporting portfolio activity and achieving high ship emissions data reporting rates. Climate alignment performance has improved, with portfolios aligning more closely with the IMO’s decarbonization trajectories. Increased collaboration between financial institutions and shipping clients is guiding the industry towards achieving net zero emissions by 2050, in line with the 2023 IMO Greenhouse Gas Strategy.

The Poseidon Principles have revolutionized transparent climate reporting in the shipping industry, integrating real emissions data into financial decision-making. Signatories use climate alignment scores to shape financing decisions, support sustainability-linked lending, and invest in green technologies like biofuels and alternative propulsion systems. The adoption of well-to-wake emissions reporting in 2023 sets a new benchmark for climate reporting, supporting the IMO’s latest ambition while acknowledging the challenges of aligning with the ambitious 2050 net zero goals. The Principles will continue to evolve, setting new benchmarks for transparency and commitment to a sustainable future.

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