Global shipping leaders unveil route to a more sustainable industry at Singapore Maritime Week

Plans presented as part of Singapore Maritime Week: highlights Singapore’s position as a key player in the global shipping industry

The Sustainable Shipping Initiative (SSI) is at Singapore Maritime Week today, launching a series of practical, collaborative action plans aimed at developing a sustainable shipping industry for the future.

The SSI is a cross-sector coalition of 16 global companies and two non-governmental organisations working together to tackle some of the sector’s greatest opportunities and challenges.

Facilitated by Forum for the Future, in conjunction with World Wildlife Fund (WWF), members include key industry players such as Maersk Line, Cargill, Lloyd’s Register, DNV, Wärtsilä and Daewoo Shipbuilding & Marine Engineering (DSME).

The action plans are a significant step for the SSI as it works toward achieving its vision of a shipping industry that is both profitable and sustainable by 2040. They will develop new knowledge, tools and processes for the industry over the next 18 months, utilising its members’ extensive expertise spanning ship owning, chartering and operations to shipbuilding and engineering, marine finance and insurance, banking, technical standards and global supply chain.

Mr Lam Wee Shann, Director Communications and Community, Maritime and Port Authority of Singapore, who is overseeing the coordination of Singapore Maritime Week (SMW), said he was happy that Singapore is hosting the meeting at this critical stage of SSI’s development.

“We are happy to welcome the Sustainable Shipping Initiative (SSI) as part of this year’s SMW. The SSI’s decision to announce their plans here during SMW demonstrates the global significance of the initiative.”

The four plans address areas with the greatest potential to accelerate change:

• Closed Loop Materials Management: The China Navigation Company (CNCo), DSME, Maersk Line and Carnival, together with Lloyds Register are focused on developing systems and practices to enable widespread adoption of closed-loop management of materials in the ship building processes. The goal is to achieve full transparency and accountability for the social and environmental impacts of all materials, from construction through to recycling of ships. Work will also focus on developing a process to manage these impacts, help companies realise the true value of ships at the end of their life and establish ways to further reduce the use of finite resources in future shipbuilding. Over the next 18 months, the group will develop a strong prototype for closed loop materials management of ships to be shared with the industry.

• Financing sustainable shipping: ABN AMRO, Cargill, Wärtsilä and RSA are partnering with other leaders in finance, insurance and shipping to develop new approaches for the financing of sustainable ships. This includes piloting at least one new financial model that will reward sustainable performance.

• Energy technology: Bunge, Gearbulk, Rio Tinto, Lloyd’s Register, together with BP Shipping, Maersk Line and Cargill are leading efforts to make low energy technologies more affordable and available. Focused on the implementation gap – many lower-energy technologies available but are not being implemented at scale – the work stream will develop robust business cases, providing the information companies need to adopt large-scale eco-efficient technologies and techniques.

• Credible Benchmarking: How to use and improve Sustainability Rating Schemes in Shipping: WWF, Carnival, Lloyds Register, Maersk Line, DNV, RSA and Unilever are helping the shipping industry navigate the growing number of beyond-compliance rating schemes, which will enable greater uptake and drive improved sustainability performance. Over the next 18 months, the group will develop a clear and comprehensive guide for how the industry uses these standards, including recommendations on which schemes to adopt to suit the needs of individual shipping companies.

Aaron Bresnahan, Vice President, Special Vessels, Wärtsilä comments: “Our customers are increasingly demanding greater efficiency and better sustainability for all of their operations. Only last month the Government of the Republic of Korea demonstrated the importance of sustainability when choosing our dual-fuel technology for a new guide ship for their port authority. Developing a sustainable industry is vital for our future and there is a lot of potential for practical improvements which we can help materialise through initiatives such as the SSI.”

It is clear that Asia has an increasingly significant role to play in the global shipping sector and a number of Asian companies are already leading the way towards developing a more sustainable industry. Korea’s DSME is setting new standards in fuel efficiency, building MAERSK’s new EEE container ships, which emit 20 per cent less CO2 per container shipped than any other vessel and CNCo is currently involved in a fleet renewal programme which will sustainably recycle ships that have come to the end of their lives.

Soren Stig Nielsen, Senior Director, Maersk Line explains: “Asia has always been a key market for Maersk Line and is becoming an increasingly important customer as well as producer. Our EEE ships being built by Korea’s DSME and the new Daily Maersk service from four Asian ports are good examples of innovative products with new customer benefits  that will help drive a needed change in global operating models – allowing economies to grow, trade to develop and social wealth to spread.”

Mr O.Y. Kwon, vice president DSME adds: “Shipping is the lifeblood of global trade, transporting more than 90 per cent of the world’s products. To ensure we protect the future of our industry and our environment, we need to work together to find greener, financially sound solutions. That means developing reliable and affordable cleaner fuel supplies and realistic technologies that can be integrated into vessels cost effectively and on a global scale.

“Due to the complexities of the issue, there has been on-going debate about what combination of alternative fuels, technologies and operations are the most commercially and environmentally sustainable. Now is the time to put it to the test.”

Jonathon Porritt, Forum for the Future’s Founder Director concluded: “The SSI has committed to an ambitious vision for the industry, and these action plans are a vital step in us achieving this vision. Work is focused on creating a clear framework that the wider industry can use to adopt more sustainable practices. Over the next 18 months, members will be developing new prototypes, technologies and financial models that promote sustainability as well as the guidelines that businesses need to implement change.

“This is an exciting step for the SSI and we are pleased to be able to unveil these plans at Singapore Maritime Week – it’s one of the premiere events in the global Maritime calendar.”

NOTES FOR EDITORS

Comment from other SSI partners:

Bunge
Giovanni Ravano, Managing Director of Bunge’s Ocean Freight Division said:“Bunge is pleased to see the SSI vision come to life in these four important work-streams. To achieve greater sustainability in shipping we need efforts that are global, practical and collaborative, and the action plans announced today reflect all three qualities. We look forward to making real progress in the months ahead.”

Cargill

Penne Kehl, Ocean Transportation Lead – Asia Pacific, Cargill Energy Transportation and Metals at Cargill, commented: “We are excited that the Sustainable Shipping Initiative decided to launch their action plans here in Asia. The region plays an integral role for global business and sustainability is rising in importance across various supply chains that are important to us. At Cargill we have significant operations in Asia, with our regional hub in Singapore, and are looking forward to seeing some of the action items proposed by SSI being implemented in the region. Sustainability is something we cannot ignore - it is critically important for the environment and our communities and ultimately our long term business success.”

Carnival
Carnival Corporation &plc VP, Maritime Policy & Compliance, Tom Strang said: “As the Asia Pacific region is becoming increasingly important to our business both as a destination and as a source market we are very pleased to be here today in Singapore working with our partners in the SSI on what are very important issues to us.

Sustainability is not a cost of doing business; it is a way of doing business.  We recognise that our success is tied to protecting the environment, safeguarding and developing our workforce, strengthening stakeholder relationships, enhancing the port communities that we visit and maintaining our fiscal strength. We also recognise that, in today’s business climate, the viability of our business as well as our reputation depends on being more sustainable and transparent.  The projects that we are working on in the SSI help us to achieve these goals.

As an example our Costa Cruises PAO (Pacific Asia Operations) office in Hong Kong recently received the “Carbon Care Champions Award 2011” by the Carbon Care Asia (CCA).”

The China Navigation Company/Swire Shipping

Tim Blackburn, Managing Director of The China Navigation Company/Swire Shipping says: “We are very aware of the finite nature of many of the resources that are processed to build ships. Whilst we acknowledge that the ship scrapping industry has existed for some time, we believe that much more can be done at relatively low cost towards the goal of total recycling of all the materials involved in constructing a ship. A closed-loop cycle that reduces the net usage of new natural resources, that is safe for the workers involved and which handles any hazardous waste in an environmentally responsible way has to become the norm for all responsible shipping companies and recyclers.”

DNV

Eirik Nyhus, Director, Environment, at the SSI’s newest member classification society DNV explained: “Being able to demonstrate how to implement changes and the effect they have on safety, the environment and the bottom line is fundamental to overcoming these challenges. That’s why we joined the SSI. Its action-orientated approach and focus on developing practical solutions with solid business cases is what the industry needs right now.”

DSME

Mr O.Y. Kwon, vice president DSME explains: “Shipping is the lifeblood of global trade, transporting more than 90 per cent of the world’s products. To ensure we protect the future of our industry and our environment, we need to work together to find greener, financially sound solutions. That means developing reliable and affordable cleaner fuel supplies and realistic technologies that can be integrated into vessels cost effectively and on a global scale.

“Due to the complexities of the issue, there has been on-going debate about what combination of alternative fuels, technologies and operations are the most commercially and environmentally sustainable. Now is the time to put it to the test.”

Lloyd’s Register

Katharine Palmer, Environmental Manager, Lloyd’s Register: “’What is actually possible’, is a key question we are asked by industry stakeholders. These work streams are an important and practical attempt to help map out a cleaner, more efficient future for shipping and answer that question.”

Maersk Line

[General]“Long-term success means anticipating and responding to change. Having a vision for the industry is an important milestone, but it won’t get us there.  We are pleased to support concrete collaboration that can provide more sustainable solutions for both our industry, and the societies and economies we serve.”- Soren Stig Nielsen, Senior Director, Maersk Line

[On Asia]“Asia has always been a key market for Maersk Line and is becoming an increasingly important customer as well as producer. Our EEE ships being built by Korea’s DSME and the new Daily Maersk service from four Asian ports are good examples of innovative products with new customer benefits  that will help drive a needed change in global operating models - allowing economies to grow, trade to develop and social wealth to spread.”–Soren Stig Nielsen, Senior Director, Maersk Line

[Closed Loop Materials Management work stream]“Considering the complete Life Cycle of ships is essential to sustainable consumption and production. By this we mean evaluating environmental, social, and economic impact of a product from the ship is designed until the materials are ready to be used again for a new product. Thinking like this is often called closed loop design and is one example of how Maersk Line is looking to integrate new thinking into its innovation activities.” [Quote Eskild Lund Sorensen, Environmental Manager, Maersk Line Sustainability]

[Energy Technology work stream]“For us, optimization of energy efficiency is an obvious priority. Greater energy efficiency equals reduced fuel consumption and cost saving. They are two sides of the same coin…” [Quote Maurice Meehan, Marine Sustainability Manager, Maersk Tankers]

[Credible Benchmarking work stream] “To make a quantum leap forward, our customers must be able to select and deselect shipping lines based on carriers’ performance - also on sustainability. We look forward to working with the SSI to further drive transparency and accountability that will reward sustainable performance and enable better, sustainable, business decision-making.” [Quote Mads Stensen, Environmental Manager, Maersk Line]

RSA

Richard Turner, Director Global Marine, RSA: “As populations grow, so too does the demand on marine resources. This places the marine environment under ever-growing pressure with the potential to radically alter already fragile ecosystems. These activities are also increasing the risks for businesses seeking to make use of new resourcesor find alternative shipping routes. By engaging with businesses and governments, insurers can help manage these risks in a sustainable and responsible way that benefits and protects our marine environment.”

Unilever

Simon Smith, VP Logistics, Unilever: “Unilever has a bold ambition to double its business and halve its environmental impact and has underpinned this ambition with the Unilever Sustainable Living Plan; nothing less than the basis of a new business model. The only way we will achieve our ambition is by working in partnerships with all our stakeholders – and this is particularly true for our logistics operations. Shipping is an increasingly important part of supply chain delivering ingredients to our factories, getting products to the market and even in disaster recovery operations like recent events in Thailand. However shipping at any cost is not an option. We increasingly demand transparency of the environmental performance of shipping and are working with other leading companies in the SSI to find ways to improve performance. The work streams launched today will support our goals in the Sustainable Living Plan.”

Wärtsilä

Aaron Bresnahan, Vice President, Special Vessels, Wärtsilä said: “Our customers are increasingly demanding greater efficiency and better sustainability for all of their operations. Only last month the Government of the Republic of Korea demonstrated the importance of sustainability when choosing our dual-fuel technology for a new guide ship for their port authority. Developing a sustainable industry is vital for our future and there is a lot of potential for practical improvements which we can help materialise through initiatives such as the SSI.”

Forum for the Future

Jonathon Porritt, Founder Director, Forum for the Future: “The SSI has committed to an ambitious vision for the industry, and these action plans are a vital step in us achieving this vision. Work is focused on creating a clear framework that the wider industry can use to adopt more sustainable practices. Over the next 18 months, members will be developing new prototypes, technologies and financial models that promote sustainability as well as the guidelines that businesses need to implement change.

“This is an exciting step for the SSI and we are pleased to be able to unveil these plans at Singapore Maritime Week – it’s one of the premiere events in the global Maritime calendar.”

For further information about the SSI and the four work streams, or to download the Vision 2040 please visit www.forumforthefuture.org/ssi
About SSI

The Sustainable Shipping Initiative (SSI) brings together leading companies from across the industry and around the world, to plan how shipping can contribute to – and thrive in – a sustainable future. www.forumforthefuture.org/ssi

Distinctive features of the SSI:

• Strategic: the Initiative looks beyond immediate regulatory concerns to the key challenges and trends, and frames an ambitious opportunity agenda for the industry.

• Global: a multinational membership to address global concerns.

• Integrated: bringing together shipping companies and key stakeholders like customers and financiers.

• Balanced: while recognising climate change, the SSI will also address wider sustainability issues such as biodiversity, transparency and economic development.

• Independent: while most members will have legitimate commercial interests, the involvement of Forum for the Future and WWF ensures that they act as an independent force for sustainable development, reinforcing constructive interaction with policy-makers.

About the SSI Vision 2040

The Vision for 2040 was signed into action in October 2011 by the Initiative’s members, to address the three principal challenges facing the industry: rising oil prices, structural shifts in world trade andgrowing scrutiny of the industry’s social and environmental performance.

It has five key objectives for the industry:

Communities To become a more trusted and responsible partner in the communities in which the industry operates;

Employment To provide a safe, healthy, secure and rewarding work environment to the over 2 million people working in shipping;

Energy & Environment To diversify the industry’s energy mix and ensure greater resource efficiency, make dramatic reductions in greenhouse gas intensity and ensure responsible governance of the oceans;

Governance To promote greater transparency and accountability at corporate and industry levels;

Innovation To enable the financing and large scale uptake of technological and operational innovations that will lead to a step-change in the industry’s performance on sustainability.

About Forum for the Future

Forum for the Future is a non-profit organisation working globally with business and government to create a sustainable future. We aim to transform the critical systems that we all depend on, such as food, energy and finance, to make them fit for the challenges of the 21st century. We have 15 years’ experience inspiring new thinking, building creative partnerships and developing practical innovations to change our world. Forum for the Future acts as convenor and facilitator of the SSI. www.forumforthefuture.org

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