Corporate Governance and the Environmental Politics of Shipping

Abstract

A handful of companies dominate the world’s shipping industry. These firms have gained political leverage over the global governance of container shipping in particular. Intriguingly, in recent years the Danish conglomerate Maersk—the world’s biggest container and shipping vessel company since the mid-1990s—has been using its influence to push for higher environmental standards for the industry as a whole. To some extent these initiatives are helping to promote environmental efficiencies, cleaner fuels, and greener technology. But they are also raising costs for small and midsized companies with extremely low profit margins, further enhancing the competitiveness of the biggest shipping conglomerates in an increasingly oligopolistic market. While voluntary self-governance by companies such as Maersk is incrementally improving the environmental management of global shipping, it is also further concentrating governance power within a few transnational corporations, potentially taking more ambitious regulation off the agenda.

The Moral Limits of Market-Based Mechanisms: An Application to the International Maritime Sector

“…The key outcome from these schemes is in fact the way such voluntary governance is used to divert authority on environmental matters from regulatory organisations. The call for more environmental regulation from market leader Maersk has even been characterised as a way to strengthen existing market dominance because the hundreds of very small operators cannot do likewise, thus “further concentrating governance power within a few transnational corporations [and] potentially taking more ambitious regulation off the agenda” (Alger et al, 2021 : 144). This outcome again ties the maritime case into Felli’s argument about the entrenchment of existing economic relations that avoid any radical system change.…”

Sustainability and Risk Management in Shipping and Logistics: Balancing Environmental Concerns With Operational Resilience

“…Maersk, one of the world's largest shipping companies, has been a pioneer in environmental stewardship (Alger et al, 2021). The company has invested heavily in fleet optimization, introducing Triple-E class vessels that are among the most energy-efficient in the industry.…”

Policy approaches to mitigate in-use methane emissions from natural gas use as a marine fuel

“…oil and gas majors in tanker shipping) may greatly influence ships' operational profiles, safety standards, and fuel consumption, thereby impacting the shipping sector's environmental performance [112,113]. The myriad actors influencing the already complex marine transportation sector, in addition to the 'flags of convenience' model prevailing in the industry [113,114], highlight the importance of a polycentric approach to environmental and climate governance in shipping that considers the entire LNG value chain including upstream emissions; where local (e.g. Port of Vancouver EcoAction Program, Norwegian NO x Fund, Maritime Singapore Green Initiative) and regional (e.g.…”