Financers pressure shipping industry to clean up its recycling practices

Banks, pension funds and other financial institutions are increasingly asked to take into account social, environmental and governance criteria when selecting asset values or clients. Investing with an eye to environmental or social issues, not just financial returns, is in demand, and the credit providers and investors of shipping are now actively taking a closer look at how they might contribute to a shift towards better ship recycling practices off the beach.  

 

Through what is known as “negative screening”, investors are using the annual lists that the Platform publishes on global dumpers to screen their portfolio. In 2018, Scandinavian pension funds the Norwegian Government Pension Fund Global and KLP divested from four shipping companies due to their beaching practices. The exclusions were made public and with written explanations. Both the breach of international human rights and the severe environmental damage caused by beaching were highlighted as reasons for the divestments.

 

"One particular problem with beaching is that shipbreaking takes place when the vessels are standing in mud and sand. As a result, the pollution leaches into the ground and is washed out with the tides. Even if arrangements were put in place at the beaching sites for the treatment of asbestos and PCBs, for example, the fundamental problem of containing and collecting the pollution would be impossible to resolve. There are better ways of dismantling ships that are readily available to the shipowner, but these are more expensive. "
Council on Ethics - Norwegian Government Pension Fund Global

 

Banks play a crucial role in supporting economic activity through their lending. They can also influence better business practices through engaging with their clients on social, environmental and governance matters. Starting off as a Dutch bank initiative with NIBC, ING and ABN AMRO as founding members, large Scandinavian and German shipping banks are now also part of a group of banks that promote responsible ship recycling and negotiate clauses to that aim in the loan agreements they sign with shipping companies. 

 

"The recycling, or scrapping, of a ship at the end of its lifecycle poses potential large social and environmental risks for the shipping industry, especially if so-called beaching practices are used. These practices mean that ships are driven directly upon beaches and dismantled under difficult working conditions and with detrimental environmental consequences as hazardous waste is discharged directly into the sea."
Nordea Bank

 

The financers of shipping have signaled that there are likely further exclusions to come. In light of the announced decommissioning in the oil and gas sector, it is further likely that investments in oil and gas assets will be also scrutinized. 

 

 

 

Council on Ethics - Recommendation to exclude Evergreen Marine Corp (Taiwan) Ltd from the Government Pension Fund Global (GPFG)

KLP - Shipbreaking practices in India, Bangladesh and Pakistan

Latest News

Brussels, Oct 30th 2020

Platform publishes South Asia Quarterly Update #23

There were a total of 170 ships broken in the third quarter of 2020. Of these, 110 ships were sold to the beaches of South Asia.

... Read More
Brussels, Oct 08th 2020

Platform News – Platform welcomes new Indonesian partner organisation

The NGO Shipbreaking Platform welcomes the Nexus3 Foundation as new partner organisation.

... Read More
Reykjavík, Sep 25th 2020

Press Release – Prosecutor launches investigation after Icelandic journalists shed light on illegal export of toxic ships to India

Kveikur uncovers the illegal export of two container ships. Ship owner Eimskip and cash buyer GMS under the spotlight.

... Read More

Related news

Brussels, Feb 04th 2020

Press Release – Platform publishes list of ships dismantled worldwide in 2019

674 large ocean-going commercial vessels were sold to the scrap yards in 2019. Of these vessels, 469 were broken down on tidal mudflats in South Asia.

... Read More
Brussels/Oslo, Jan 16th 2018

Press Release – Norwegian Central Bank excludes companies from government Pension Fund Global because of their beaching practices

  The Norwegian Central Bank announced today its decision to exclude ship owners Evergreen Marine Corporation, Precious Shipping, Korea Line Corporation and Thorensen Thai Agencies from the… Read More

Brussels, May 30th 2017

Press Release – Platform supports banks’ introduction of responsible ship recycling standards

  Today, during the first day of NOR-Shipping in Oslo, Dutch banks ABN AMRO, ING Bank and NIBC, together with the Scandinavian DNB, announced that they are… Read More

Brussels, Jan 30th 2019

Press Release – Platform publishes list of ships dismantled worldwide in 2018

744 large ocean-going commercial vessels were sold to the scrap yards in 2018. Of these vessels, 518 were broken down on tidal mudflats in South Asia.

... Read More
Oslo, Sep 05th 2019

Press Release – NGOs release new report on North Sea oil and gas recycling

The NGO Shipbreaking Platform released today a report on offshore decommissioning during a seminar held in Oslo, Norway.

... Read More
Brussels, Mar 20th 2019

Platform News – Norwegian pension funds turn their attention towards Indian shipbreaking practices

Last week the Council on Ethics of the Norwegian oil pension fund (Government Pension Fund Global) announced that it will turn its attention towards Indian shipbreaking practices…. Read More

More news
Donate

NGO Shipbreaking Platform
The leading NGO coalition campaigning for clean and safe ship recycling

© 2019 NGO Shipbreaking Platform  |  Privacy Policy  |  Designed by Essence Creative  |  Developed by Mr Web