Draft:Danish sustainable shipping diplomacy

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Introduction[edit]

The rise of sustainable shipping in maritime politics[edit]

According to world shipping Council, maritime shipping stands out as the most sustainable method for transporting goods.[1]. However, due to the sheer scale of global trade, the shipping industry accounts for 2.1% of the global CO2 emissions[1]. Therefore, in recent years, there has been a growing emphasis of enhancing the sustainability of the shipping industry. The primary governing body for the world’s shipping industry is the International Maritime Organization, hereinafter referred to as the IMO. It is a specialized United Nations agency responsible for the safety and security of shipping as well as preventing marine and atmospheric pollution by ships[2]. Hence, the IMO has a key role in addressing the challenge of reducing the shipping industry’s greenhouse gas emissions[1]. Given the cross-body nature of the shipping industry, international regulatory bodies such as the IMO are essential[2]

The Danish shipping industry[edit]

The size of the Danish shipping industry[edit]

Denmark plays a crucial role in the international shipping industry. Danish shipping companies, with a fleet of 1.965 vessels, solidify the nation’s standing as the fifth-largest shipping country worldwide.[3]. Furthermore, Denmark ranks as the 7th biggest maritime industry globally, boasting a production value surpassing 85 billion DKK[3]. Due to the international nature of the shipping industry, more than 90% of Danish shipping activities occur beyond the nation’s borders, with 75% taking place outside of Europe[3]. In 2022 alone, the Danish shipping sector accounted for 27% of the country’s exports, establishing itself as the largest exporting industry in Denmark[4][5]. Notably, the Danish company A.P. Møller – Mærsk, recognized as the world’s largest shipping company (hereinafter: Mærsk) plays a prominent role in the global shipping landscape[6]. Denmark's dominant presence in international shipping, characterized by substantial maritime production and influential industry leaders like Mærsk, firmly establishes the country as a major power and a pivotal player in shaping global maritime dynamics.

Danish sustainable shipping diplomacy[edit]

In recent years, Denmark has emerged as a pivotal player in sustainable shipping diplomacy, with key actors both from the public and private sector[7]. The field of sustainable shipping involves environmental responsibilities, economic interests and international relations[8]. This is reflected in the diversity of actors and the interests they represent. From government-led initiatives to private endeavors, Denmark’s maritime realm has experienced a united push to tackle the issues of environmental impact and climate change within the maritime sector[9]. The increasing significance of ocean politics on the world stage serves as a clear indicator of the key role played by Danish sustainable shipping diplomacy.

Key actors[edit]

Danish Shipping[edit]

Danish Shipping, the industry association representing Danish shipping interests, comprises a membership exceeding 90 companies, including major industry players like Mærsk, Ørsted, and DFDS[10]. Naturally, Danish Shipping is involved with a range of projects, focusing on both the technical and political aspects of reducing greenhouse gas emissions in the shipping industry, and they cooperate closely with the Danish authorities[7].

Danish Shipping’s climate goals are also outlined in their strategy paper ‘Towards Zero’. Here, they present the ambitious goal of propelling the global shipping sector towards achieving zero emissions by 2050, without relying on carbon offsetting[11]. This commitment involves ensuring that, by 2030, at least 5% of the Danish-operated fleet can use well-to-wake net-zero-emission fuels. Additionally, all new vessels ordered by Danish shipowners from 2030 onwards are equipped for net-zero-emission fuels[11]. This goal surpasses the current global targets set by the IMO, which underscores Denmark’s leading role in the global transition in the shipping industry[7].

Danish Shipping's strategy not only reflects a commercially driven motivation but also underscores an awareness of the climate crisis, which is reflected in their global climate policy paper[11]. In the paper, they focus on derisking the transition and accelerating the technical developments to ensure that the necessary measures are implemented in time to reach the goals set by Danish Shipping and the IMO[11]. As the Danish shipping industry’s representative body, Danish Shipping is a crucial player in shaping the agenda, making their strategy and climate policy papers indicative of the industry’s stance on sustainability issues.

The Danish Maritime Authority[edit]

The supervision of the Danish shipping industry is conducted by the Danish Maritime Authority, a division of the Danish Ministry of Industry, Business, and Financial Affairs[12]. The Ministry of the Environment and the Ministry of Energy, Utilities and Climate are responsible for legislation in the environmental and climate field, with oversight from the Danish Maritime Authority in terms of policy development, practical implementation, and enforcement[12][13].

The Danish Maritime Authority establishes the framework for a competitive maritime sector and ensures the ocean health and personnel rights and well-being[12]. In the realm of climate and sustainability, the Danish Maritime Authority collaborates with other authorities, including the EU and IMO, in the formation of regulations in the environmental and climate field[13]. This is both to address greenhouse gas emissions from shipping activities and align with the objectives of the Paris Agreement's and the Sustainable Development Goals[14]. This underscores the agency’s global outlook when regulating the shipping industry[13].

In a report from June 2023, the Danish Maritime Authority reflected on the production and employment in the Blue Denmark for the year 2022, highlighting the industry's green transition[15]. Notably, the report highlighted the significant demand for electrolysis power for the shipping industry to achieve its target of 5% of all ships running on green propellants by 2023[15] .

Furthermore, the Danish Maritime Authority actively engages with various international organizations, for instance by hosting events such as the international conference on the final climate negotiations regarding the revised IMO GHG emission strategy in February 2023[16]. Lastly, the agency also plays a crucial role in the 'Zero-Emission Shipping Mission’ [17][18]

Mærsk[edit]

Mærsk is a global conglomerate engaged in global trade, shipping and energy, across 130 countries.[19]. Mærsk was founded in 1904 and has been run by the Møller-Mærsk family ever since – they currently hold slightly more than 50% of the share capital[19]

Mærsk stands out as a major influencer in Danish shipping, and has assumed a prominent role in the sustainability agenda. Despite being responsible for 3.5 billion tonnes of annual direct emissions, Mærsk has set the ambitious target of reaching net zero emissions by 2040[20]. The company’s sustainability report for 2022 outlines initiatives and goals for climate and sustainability, highlighting progress in implementing green shipping practices[20]. The report also highlights Mærsk's active engagement with international organizations like the IMO and EU, along with collaborations involving Danish authorities, customers, civil society actors, and NGOs[20]. Lastly, Mærsk actively engages in various partnerships and coalitions, including the World Maritime Forum, Road Freight Zero, First Movers Coalition, and Getting to Zero Coalition[20]. As the world's largest shipping company, Mærsk's sustainability initiatives and strategic focus align with the industry-wide commitment to climate initiatives, solidifying Denmark’s position as a key player in this vital policy area.

Green fuels and Laura Mærsk[edit]

One of Mærsk’s sustainability initiatives involves investing in vessels capable of running on green fuels[21]. Mærsk made history as the first shipping company to order green-methanol ships in 2021. As of Jnauary 2024, their total dual-fuel order is 19[20]. This investment contributes to propelling the industry towards a new fuel infrastructure relying on green rather than fossil fuels. In 2023, Mærsk launched its very first methanol-fuel ship[22]. At a ceremony in Copenhagen, Denmark, in September 2023, the president of the EU Commission Ursula von der Leyen revealed the name – Laura Mærsk[21].  

Mærsk’s research and development center[edit]

Mærsk has solidified its position as an industry pioneer by establishing the not-for-profit Mærsk Mc-Kinney Møller Center for Zero Carbon Shipping - an independent research and development center committed to accelerating the shipping industry's shift towards sustainable practices and technologies.[23]. The Center, based in Copenhagen, has multiple industry partners worldwide[24]. Founded in 2020 with a start-up donation of DKK 400 million from the A.P. Moller Foundation, it collaborates with major energy and transportation companies, along with knowledge partners such as Danish Shipping, Global Maritime Forum and the Danish Maritime Authority[24][25]. Additionally, the Center partners with multiple organizations and coalitions, including Blue Sky Maritime Coalition, Getting to Zero Coalition, and the European Union[25]

Organizations, partnerships and coalitions with Danish participation[edit]

The International Maritime Organization (IMO)[edit]

The International Maritime Organization is the United Nations specialized agency and the global standard-setting authority for the safety, security and environmental performance of the global shipping industry[26]. Established in 1948, the IMO originated when the United Nations adopted a convention to create the organization[27]. At its establishment, the IMO’s primary purpose was to provide regulation in terms of trade, maritime safety and the efficiency of navigation[27]. As of now, the IMO has 175 member countries[28].

IMO’s greenhouse gas targets and Denmark’s commitment[edit]

Although IMO’s most important responsibility was – and is – safety, the marine environment has emerged as a major problem in the shipping industry[27]. In 2020, the IMO published its latest Greenhouse Gas (GHG) study, revealing a rise in the share of shipping emissions in global emissions (from 2.76% in 2012 to 2.89% in 2018)[29]. Acknowledging the shortcomings of its initial 2018 GHG strategy, where a 50% reduction in GHG emissions by 2050 was agreed upon (without intermediate targets), the IMO reassessed its approach in the summer of 2023[30][31]. The updated GHG strategy includes the goal of achieving net-zero GHG emissions “by or around 2050”, accompanied by indicative checkpoints[31]. The checkpoints aim for a 20% (striving for 30%) reduction in total GHG emissions by 2030 and 70% (striving for 80%) by 2040, relative to 2008 levels[31]. While the revised strategy lacks legal force, they make it possible to enforce the implemented measures[30]. The revised strategy highlights the commitment to reducing GHG emissions from international shipping shown from the IMO, which is further underscored by the vision of the strategy phrased as 'a just and equitable transition.' This dual focus reflects the organization's dedication to balancing commercial interests with social and environmental standards[31].

Denmark has a longstanding history with the IMO. It was first elected to the IMO Council in 2001 and has been re-elected continuously.[28]. This underscores Denmark’s long-standing commitment to IMO[32]. In Denmark’s candidature submission for the 2024-2025 term, Denmark committed to working to secure and promote international standards on safety, efficiency of navigation as well as the prevention of marine pollution from ships[33][34]. Denmark was re-elected to the IMO council in December 2023 for the 2024-2025 term under Category C[33]. As a continuous member of the IMO council, Denmark contributes to shaping the strategies and work priorities of the IMO[33]. Andreas Nordseth, Director General of the Danish Maritime Authority, states that “Denmark stands committed to keep the IMO as the strong focal point of global maritime regulation[33]. This shows a Danish interest in keeping the IMO relevant even though the shipping industry is dominated by strong private actors and has been inevitably difficult to regulate. Anne H. Steffensen, CEO of Danish Shipping, emphasizes the crucial role of the IMO as the primary forum for discussions on shipping regulations. In addition, she highlights Denmark’s key role in shipping diplomacy as “one of the world’s largest merchant fleets”[28]

The title of Denmark’s election campaign was “Promoting green shipping for a sustainable future”, underscoring Denmark’s role as a pioneer and advocate of sustainable shipping[33]. Anne H. Steffensen emphasized that as a member of the IMO Council, Denmark will work to achieve the necessary results for global shipping to meet the goal of climate-neutrality by 2050[28]. In the election campaign, published by the Danish Maritime Authority, a continued focus on the mitigation of the environmental impact from global shipping is emphasized. Different strategies are presented in the campaign paper; from calls to further reductions in GHG emissions to sustainable methods and technologies by promoting innovative ship designs[33]. As the biggest Danish shipping company, Mærsk, has a leading role in sustainable ship design, this shows how Denmark utilizes its influence in the IMO to promote Danish interests in regards to sustainability. Additionally, it reveals the coordinated sustainable shipping diplomacy carried out by the Danish key players – using the UN agency platform to establish the interests of both official and private Danish actors.

The European Union (EU)[edit]

The European Union (EU) doesn’t have a prominent role in sustainable shipping literature, possibly due to the intricate challenges of regulating an industry that transcends beyond national borders. As a result, enforcing regulations without putting companies from EU countries at a competitive disadvantage is a major challenge for the EU. Still, Blue Denmark (Det Blå Danmark), a Danish climate partnership with various sector-specific collaborations, emphasizes that while the IMO continues to be the primary platform for international framework in the shipping industry, the EU has the potential to emerge as a key actor within the sustainability area, for example through more active participation in the IMO[3].

The European Sustainable Shipping Forum (ESSF) is an attempt to do just that. ESSF serves as a platform for knowledge-sharing, cooperation and coordination between the Commission, Member States’ authorities, and maritime transport stakeholders, focusing on issues involving both the sustainability and competitiveness of EU maritime transport[35]. Among others, the ESSF has been used to prepare coordinated submissions to the IMO from the Member States[35]. Thus, the EU provides an alternative avenue for influencing the international framework set by the IMO. Moreover, in March 2023 the EU reached an agreement on the world’s first green shipping fuels law[36]. Ships will be required to increasingly switch to sustainable fuels and includes clear benchmarks from 2030 and forward[36]. When the FuelEU Maritime law was first proposed, Mærsk supported the proposal with several exceptions in an April 2022 position paper, calling for increased support for renewable fuels[37]. Additionally, Mærsk stated support for the EU Fit for 55-package when it was under negotiation[37]. These are just some examples of how Mærsk, a Danish company, has advocated for the sustainability agenda through the EU.

The Sustainable Shipping Initiative[edit]

The Sustainable Shipping Initiative is a multi-stakeholder collective working with sustainability within the shipping industry[8]. It was founded in 2010 by Forum for the Future, WWF and five shipping companies: ABN Amro, BP Shipping, Gearbulk, Lloyd’s Register and Mærsk[38]. As one of the founding members and a prominent global shipping company, Mærsk plays a pivotal role in this coalition. Furthermore, in 2022, the Sustainable Shipping Initiative became Knowledge Partner of the Mærsk McKinney Møller Center for Zero Carbon Shipping, solidifying a long-term strategic partnership to accelerate the green transition in the maritime industry[24]. Thus, not only is Mærsk involved as a founding member, its research center is also a partner and therefore part of the technological cooperation of decarbonizing the industry.

The Sustainable Shipping Initiative takes a holistic approach to sustainability, addressing six vision areas outlined in their ‘Roadmap to a sustainable shipping industry’: Oceans, Communities, People, Transparency, Finance and Energy[8]. This approach is chosen to fit the challenge; a triple planetary crisis. The crises and their causes are deeply interconnected, necessitating a systemic approach to solutions[8]. Initially launched in 2016, the Roadmap was updated in 2020 to reflect the continuous changes in the shipping sector and to ensure its ongoing relevance[39]. Companies and organizations can utilize the Roadmap’s indicators to report and track progress of their sustainability journey, making it a direct tool for all actors in the shipping industry, both members and non-members[40]. Their ongoing projects involves extending the lifecycle of vessels, working to secure seafarer’s rights, and developing sustainability criteria for marine fuels[41].

Lastly, the Sustainable Shipping Initiative aims to include a wide variety of stakeholders, such as shipowners, operators and managers, charterers and cargo owners, ports and service providers, as well as environmental and social NGO’s.[41]. In addition, they collaborate with other organizations and coalitions such as the Getting to Zero Coalition[38]

The Global Maritime Forum[edit]

The Global Maritime Forum is an international not-for-profit organization dedicated to shaping the future in the global shipping and trade industry, ensuring long-term sustainability and profitability[42]. The Global Maritime Forum’s primary platform is its Annual Summit, bringing together high-level leaders from the maritime industry, policymakers, NGO’s, experts and other influential decision-makers to address the industry’s global challenges[42]. Global Maritime Forum profiles itself as cross-country and multi-stakeholder, and highlights its ability to convene high-level leaders from the entire maritime industry[42].

Whilst the Global Maritime Forum works with a large range of issues within the shipping industry, they have multiple sustainability initiatives. Two of those are their involvement with the Poseidon Principles and the Getting to Zero Coalition.

Financing sustainable shipping: the Poseidon Principles[edit]

The Poseidon Principles offer a global framework for integrating climate considerations into lending decisions, aiming to promote the decarbonation of international shipping[43]. The framework is used to assess and disclose the climate alignment of financial institutions’ shipping portfolios[44]. They establish a common, global baseline to disclose whether financial institutions’ lending portfolios are in line with adopted climate goals[44]. The principles align with the policies and ambitions of the IMO, including the goal to reduce shipping’s total annual GHG emissions by at least 50% by 2050[43]. Presently, 34 financial institutions are signatories to the Poseidon Principles, representing a bank loan portfolio to global shipping exceeding 80% of the total global ship finance portfolio. The signatories include Danske Bank and Nordea Bank, two of the biggest banks operating in Denmark[45]. The drafting of the Poseidon Principles was led by a group of global shipping banks under the auspices of the Global Maritime Forum, including leading industry actors, including Mærsk – highlighting the influential role played by Danish players in the development stages of new sustainability frameworks and agreements[43].

The Getting to Zero Coalition[edit]

The Getting to Zero Coalition is an industry-led alliance with more than 200 organizations (including 160 companies) across the energy, infrastructure, maritime and finance sectors and is supported by key governments and IGO’s[46]. Initially founded by the Global Maritime Forum in collaboration with the World Economic Forum and Friends of Ocean Action, the Coalition it is currently managed by the Global Maritime Forum[46].

Among the Coalition members are several Danish companies, including Mærsk, Danfoss, Danske Bank, Mærsk Broker, Ørsted, Port of Aaarhus, and Vestas[46]. Moreover, many of the other coalition members have Danish offices or work closely with the Danish companies. Thus, the Danish companies’ presence is noteworthy. Additionally, the Mærsk Center for Zero Carbon Shipping is one of ten knowledge partners of the Coalition. Finally, the Coalition receives government endorsement from 14 countries, including the Danish government (ministered through the Ministry of Foreign Affairs)[47].

Committed to aligning with the IMO ambitions from their revised GHG strategy, the Getting to Zero Coalition aims to reduce the GHG emissions from the shipping industry.[46]. The Coalition believes that for this to happen, commercially viable zero emission vessels must start entering the global fleet by 2030[46]. The Coalition’s focus on zero emission vessels extends to the construction of such ships, the value chains associated with the shipping industry, and the development of the infrastructure for green fuels[46]. Mærsk, being the first company to launch a container vessel powered by green methanol, showcases a noteworthy alignment between the Coalition’s goals and Mærsk’s interests. This underscores the active involvement of Danish shipping interests in setting agendas within international partnerships[21]

Mission Innovation – The Zero-Emission Shipping Mission[edit]

The Mission Innovation is a global initiative of 23 countries and the European Commission dedicated to making clean energy affordable, attractive and accessible through investment and research[48]. Mission Innovation has multiple missions, each with their focus and goals. One of these are the Zero-Emission Shipping Mission[49]. Denmark, under the leadership of the Danish Maritime Authority, along with the United States, Norway, Global Maritime Forum and the Mærsk McKinney Møller Center for Zero Carbon Shipping, is at the forefront of the mission. The Danish Maritime Authority describes it as a public-private partnership [18]. At COP26 in Glasgow in 2021, the Danish Prime Minister presented the Zero-Emission Shipping Mission[18]. The goal was to garner political support for more ambitious targets GHG targets within the IMO, particularly considering it was two years ahead of the revised GHG strategy paper from the IMO[18].

The Zero-Emission Shipping Mission aims to develop and deploy zero-emission fuels, ships, and fuel infrastructure by 2030, ultimately making zero-emission shipping the preferred choice for ship owners[50]. The Mission brings together countries, the private sector, research institutes, and civil society, with a focus on global leadership and cooperation[17]. One of their initiatives is an online platform developed by the Mission, that collects relevant knowledge to support green shipping corridor formation[50]. The initiative, with two out of five co-leads being Danish, exemplifies the active engagement of Danish actors in international sustainable shipping diplomacy. Moreover, it underscores the robust cooperation between the Danish public and private sectors within sustainable shipping, as they collaborate in co-leading this initiative.

References[edit]

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