The Lloyd’s List Podcast: How to balance ambition with uncertainty
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Decarbonisation commitments, demand signals and pledges are great, but the true test of progress will be within shipping companies themselves and right now the vast majority are not clear what their strategy is. Shipowners exist in a grey area and it’s an uncomfortable place to be. This week’s edition of the podcast looks at the difficult balancing act that shipowners must perform as they weigh up their climate ambition against strategic uncertainty
SHIPPING has about eight years to set its course for success or failure on the path to decarbonisation.
It may be the defining challenge of the next half-century, but the decisions taken now are the ones that matter.
And that is why we have seen a slew of commitments, declarations, and pledges being hastily pumped out of the industry with some urgency.
But how do you set a strategy amid so much uncertainty? The fuels, the infrastructure, the regulations, even the demand is ultimately a matter of guesswork for shipowners right now.
When the Mærsk Mc-Kinney Møller Center for Zero Carbon Shipping did a study of shipowners actual commitments last month, it found that only 35% had clearly expressed an emissions target to either be net zero by 2050 or had committed to International Maritime Organization targets.
That is not because shipowners are a bunch of reckless environmental pirates. It is because they exist in a grey area right now where decision making is extremely risky.
The ambitions being set by coalitions of public and private actors are an important first step to initiate policy changes and guide corporate transitions. However, ambitions must be followed by immediate action to achieve global climate goals. The ultimate test of the impact of global pledges is how they play out within shipping companies themselves.
This week, we invited onto the podcast someone who has been tasked with making those difficult decisions to understand how a shipping company sets an ambitious strategy for decarbonising while not knowing so many of the factors that will determine the outcome of its decisions.
Susana Germino is the head of decarbonisation and environmental compliance at Swire Shipping. She is setting the agenda for a significant fleet at both Swire Shipping’s container operations and Swire Bulk, two very different operations. She is leading projects around methanol, she looks at partnerships, investments, collaboration, green corridors — all of those practical and extremely difficult commercial decisions that stem from the desire to decarbonise a company that like the rest of us exists within a grey area right now.
So why it is so difficult to be an ambitious shipowner when it comes to making decisions about decarbonisation — a process we all know has to happen and happen quickly?