Shipping as a productive sector is synonymous with the very core of entrepreneurship, as it mobilizes huge investments of fixed capital on one hand and plays a decisive role in the operational quality of the supply chain on the other.

This very pivotal position of the shipping sector at the centre of economic activity has resulted in the harmonization of these companies with a set of rules –primarily technical and regulatory in nature– regarding the impacts, as well asthe performance achieved in terms of sustainability criteria (ESG).

International shipping is responsible for approximately 3% of global greenhouse gas (GHG) emissions, a trend that is on the rise. However, environmental impact is not limited to atmospheric emissions alone. Noise pollution, ship discharges, and other factors can also harm ecosystems. The IMO has set strategic targets to reduce the carbon intensity of international shipping by 50% by 2050 compared to 2008 levels. Additionally, the European Union has included shipping in the Emissions Trading System (ETS) from 1/1/2024, meaning that shipping companies will need to purchase emission allowances, adding to their compliance costs. Each ship-owning company is now required to purchase three tons of carbon dioxide emissions for every ton of fuel consumed on one of its vessels. The ETS provides for the gradual inclusion of corporate fleets, with 40% of their emissions covered from 2024, 70% from 2026, and 100% from 2027 onwards.

Adapting to the changing regulatory landscape, businesses must take seriously their evolving environmental performance. Their customers will now demand –for their own benefit, obviously– a supply chain with zero footprint, while investors and financiers will evaluate companies based on these very performances. The Poseidon Principles served as the first framework for approaching these new data, regarding assessment and required disclosures, concerning the climate alignment of the shipping finance portfolios. The 34 (so far) signatories to this initiative currently represent about $200 billion in shipping finance (approximately 50% of total capital). Concurrently, the Poseidon Principles initiated the establishment of another independent mechanism in October 2020. Named the Sea Cargo Charter, it provides a comprehensive framework aligning chartering activities with responsible environmental behaviours, aiming at net carbon footprint.

Finally, an additional initiative, the Poseidon Principles for Marine Insurance, was launched in December 2021, bringing together a group of maritime insurance companies fully committed to achieving full alignment across their portfolios to achieve a net environmental footprint. Additionally, they chose to take measures to align with the Paris Agreement, aiming for a 100% reduction in CO2.

Beyond all institutional and sectoral interventions, however, the "fuel” in implementing the entire plan comes from recent developments in artificial intelligence combined with a burgeoning ecosystem of technology companies, as
well as significant investments in alternative energy sources and infrastructure.