SSI Highlights the Rise of the Sustainable Shipper
Charterers’ future procurement decisions will be driven by an increasing drive to improve sustainability within shipping supply chains.
The Sustainable Shipping Initiative (SSI), a pioneering coalition of companies from across the global shipping industry focused on uniting commercial growth with sustainable behaviours, is demonstrating how charterers are becoming a powerful force in driving sustainable shipping standards and becoming a catalyst for instigating industry change beyond regulation.
Initiatives by SSI members such as AkzoNobel, Cargill and Bunge have highlighted the link between proactively implementing new, innovative measures within their shipping operations as part of wider business-led sustainability strategies, and achieving significant tangible financial and environmental benefits as a result. These include:
- AkzoNobel: The company has incorporated the use of the ship ratings scheme, Clean Shipping Index, within its tendering process and has found that using this to inform purchasing decisions is strengthening its business value chain as a whole
- Bunge: Since 2013, Bunge has saved approximately 10,000 metric tonnes of marine fuel by running 25% of its fleet at slower speeds. It has also created a transparent global emissions index to inform transport industry decision-making as well as incentivising the building and use of more fuel efficient ships.
- Cargill: The company has committed to using the RightShip Green Rankings system in its vessel selection process and will only charter vessels that meet particular efficiency ratings levels. By using this alongside other environmental innovation practices, Cargill is averaging significant emission reductions.
“Including a consideration of eco efficiency rates within the tender process enables a more holistic assessment of tender responses”, commented Carol Routledge, Global Sustainability Manager, AkzoNobel. “It helps us to ensure that data on the environmental impact of the shipping services purchased is given due weight, alongside other considerations such as the financial impact of choices made.”
Maersk Line has also received burgeoning interest from customers enquiring about the social and environmental impacts of its operations. Today, up to 19% of its customers are requesting sustainability information as part of their contracted relationship with the company. In addition to a broad, measured strategy that aligns sustainability with business materiality, Maersk Line has been working closely with the Clean Cargo Working Group to develop a mainstream methodology to measure and report on carbon emissions.
Signe Bruun Jensen, Head of Sustainability, Maersk Line said: “We are keen to collaborate with first-movers to accelerate the development, promotion and adoption of best practices for integrating sustainability into logistics and procurement strategies as ultimately we believe that this will benefit our business, our customers and the industry as a whole.”
The SSI anticipates that charterers’ sustainability and procurement processes will become increasingly interlinked, but that challenges remain in terms of ensuring this integration is smooth and mutually beneficial. The organization emphasises that greater global standardization across ship ratings schemes and the measurement parameters for CO2, SOx and NOx emissions could help to drive greater transparency, efficiency and more consistent benchmarking for future improvements. In recognition of these factors, all SSI members have signed up to a series of measurable shared commitments which include aspects such as implementing a sustainability strategy that aligns with its core business goals as well as setting out clear reduction targets on environmental issues that are material to their businesses.
Alastair Fischbacher, Director, The Sustainable Shipping Initiative concluded: “Charterers will play an increasingly significant role in defining how the shipping industry integrates sustainability into strategy and operations. Demonstrating how shipping can strengthen, not compromise, their customers’ supply chains is a powerful commercial tool and drives home the business imperative for carriers to embrace sustainable practices. By doing so, the industry as a whole can raise its game.”