Global framework will establish a common baselineThe Poseidon Principles are a global framework for assessing and disclosing the climate alignment of financial institutions’ shipping portfolios. The Poseidon Principles establish a common baseline to quantitatively assess and disclose whether financial institutions’ lending portfolios are in line with adopted climate goals.
In this way, they also serve as an important tool to manage critical investment risks.
“As one of the leading financial institutions within the shipping industry, we recognize our role in addressing and promoting the sector’s high ambition to decarbonize going forward. We believe that the Poseidon Principles will be an important initiative in this respect,” says Øivind Haraldsen, Global Head of Shipping in Danske Bank.
The Poseidon Principles are consistent with the policies and ambitions of the Initial GHG Strategy adopted in April 2018 by member states of the International Maritime Organization (IMO), a specialized agency of the United Nations responsible for regulating shipping.
The strategy prescribes that GHG emissions from international shipping must peak as soon as possible and that the industry must reduce the total annual GHG emissions by at least 50% of 2008 levels by 2050, with a strong emphasis on zero emissions.
How does it work?
The Poseidon Principles are applicable to lenders, relevant lessors, and financial guarantors including export credit agencies. They are implemented in internal policies, procedures and standards and applied in all credit products secured by vessels that fall under the purview of the IMO.