ELEVEN major banks with a collective shipping portfolio worth over $100bn will for the first time integrate climate considerations into lending decisions as part of a major new initiative launching today to incentivize maritime shipping’s decarbonization.

The Poseidon Principles, as they are known, are a major new global framework for assessing and disclosing the climate alignment of financial institutions’ shipping portfolios.

With more banks expected to sign up to the principles imminently, the principles represent a significant new driver towards the International Maritime Organization’s goal of reducing shipping’s total annual greenhouse gas emissions by at least 50% by 2050.

They also promise to dramatically change the conversation between shipowners and banks.

This is the first time we have seen a sector-specific alignment of banking portfolios to climate goals and the process of transparently measuring collective lending decisions against carbon reduction targets means there will be a direct impact of lenders’ decision making from here on.

In the words of one senior banker – capital is only going to flow in the direction of those people making the right decisions.

Joining Lloyd’s List Editor Richard Meade to discuss the implications of this unique and seismic initiative in this special edition of the podcast, is one of the founding architects of the principles, Citi’s global head of shipping and logistics Michael Parker.

Don’t forget, you can now subscribe to the Lloyd’s List Podcast via iTunes and Spotify, as well as most other podcast providers. And make sure you are registered for a free account on Lloydslist.com so you can receive our Daily Briefing e-mail.