Poseidon Principles become reality as banks publish climate disclosure

The Poseidon Principles Annual Disclosure Report 2020 shows that three banks’ ship finance portfolios are aligned with UN decarbonization targets while 12 banks’ portfolios are not.

International ship finance confirms its leadership role in global climate finance as the signatories to the Poseidon Principles delivered on their commitment and published the Poseidon Principles Annual Disclosure Report 2020 – the first sector-specific climate alignment report of its kind.

The Poseidon Principles Annual Disclosure Report 2020 shows that three banks’ ship finance portfolios are aligned with UN decarbonization targets while 12 banks’ portfolios are not.  The assessment by each Signatory includes emissions data collected from clients and the portfolio information from 2019, compared to a decarbonization trajectory for the same year. 

The Poseidon Principles establish a global framework to quantitatively assess and disclose whether financial institutions’ lending portfolios are in line with climate goals set by UN maritime agency, the International Maritime Organization (IMO). 

The IMO’s initial GHG strategy prescribes that international shipping must reduce its total annual greenhouse gas emissions by at least 50% of 2008 levels by 2050, whilst pursuing efforts towards phasing them out as soon as possible in this century.

“This report marks a significant milestone for global ship finance and for climate finance reporting as a whole.  I commend my fellow Signatories for their pioneering efforts to be transparent and accountable for their role in promoting responsible environmental behavior. I encourage other serious banks and export credit agencies to join us in supporting global seaborne trade in a sustainable manner,” says Michael Parker, Chairman, Global Shipping, Logistics and Offshore, Citi, and Chair of the Poseidon Principles Association.

20 financial institutions have joined the Poseidon Principles. Together, they represent over US$150 billion in loans to international shipping – more than a third of the global shipping finance portfolio. 

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