New analysis is a wakeup call for shipping industry’s leaders to get serious on voluntary climate standards, as time is running out
LONDON : A new study by UCL Energy Institute Shipping and Oceans Research Group, Wageningen University & Research, and University of East Anglia, revealed that private voluntary standards, such as the Poseidon Principles and Climate Bonds Initiative, in the shipping sector are becoming more ambitious, transparent, and reliable but still fall short on ambition and transparency, needed to meaningfully support the shipping sector’s decarbonisation in a crucial phase.
Published in the Marine Policy journal, the study titled “Revisiting the Role of Private Voluntary Standards in Decarbonising Shipping,” analysed five post-2018 private sector standards – Poseidon Principles for Finance, Poseidon Principles for Marine Insurance, Sea Cargo Charter, Science Based Targets Initiative for Shipping, and the Climate Bonds Initiative. Using content analysis and interviews, the study found notable improvements compared to earlier initiatives. However, no single initiative scored highly on the three evaluation criteria – ambition, transparency and reliability, thereby limiting their overall effectiveness as enablers of the transition, a finding that is common across many voluntary private standards in other sectors analysed in the paper.
Dr Nishatabbas Rehmatulla, Principal Research Fellow at the UCL Energy Institute, lead author of the study warning: “Private standards are an essential tool during the ‘emergence phase’ of shipping’s transition but they must move beyond minimum compliance to truly lead. The analysis should serve as a wakeup call for the standards and their participants to step up their efforts to realise their relevance and true transformative potential in a quickly closing window of shipping’s transition that will soon be followed by a regulatory driven diffusion phase.”
Improvement in ambition but not leading the charge: Newer standards show improved ambition compared to pre-2018 efforts, with stronger commitments and broader emissions scopes, for example many include all relevant GHG emissions (CO2, N2O, CH4) on a well-to-wake basis (emissions from fuel production and use) but these mostly mirror rather than exceed IMO targets, falling short of the Paris Agreement’s 1.5°C pathway which requires steeper reductions sooner. This shows that these initiatives are still failing to respond to wider calls for improvement, for example from the UN’s High-Level Expert Group on the Net-Zero Emissions Commitments of Non-State Entities guidance on integrity. Interviews shed some light on why such a gap exists, which includes the trade-off between ambition and number of participants or coverage of emissions, the latter often prioritised in some standards to create ‘safety in numbers’. The gap widens further when comparing stated ambitions to actual action – content analysis reveals a significant gap between participants’ stated ambitions and their actual performance.
Lack of granular transparency limits the transformative potential: Relative to many older initiatives (pre-2018),many of the new standards show improved transparency, for example through the public disclosure of aggregated climate alignment scores by participating financial institutions, marine insurers, and charterers. However a major gap remains, as no private standard publishes individual data for vessels and aggregated emissions at the company level, despite having the capability, limiting comprehensive understanding, accountability and the ability of non-participants to use their published data to make informed commercial choices. Generally, this means these standards are failing to plug the gap in regulations such as the IMO Data Collection System (DCS) or EU Monitoring Reporting and Verification (MRV).
Room for improvement in reliability of the standards: Newer standards predominantly use more reliable metrics like the Annual Efficiency Ratio (AER) and Energy Efficiency Operational Indicator (EEOI) for estimating emissions from operations, moving away from less reliable design-based metrics. Many leverage data from the IMO DCS or EU MRV, which involve third-party verification, although the stringency of verification varies between the two, but some standards also allow or rely on self-reported data. While improved, some initiatives still primarily use AER, which is a less reliable emissions metric than EEOI, as it doesn’t account for actual cargo carried.
Dr Judith van Leeuwen, Associate Professor at Wageningen University, said: “The urgency for the maritime industry to decarbonize is greater than ever. Voluntary standard initiatives are an important means to get together proactive leaders within the maritime supply chain that seek to overcome major technological, financial, and political obstacles in transforming maritime transport to a climate-neutral future. This study is therefore very timely and underscores the role of voluntary standard initiatives and what they need to do to make most impact.”
Interviews revealed the key drivers and motivations for improvement across the criteria. These included customer or stakeholder value chain pressure e.g. investors, to be more environmentally friendly and demonstrate action on overarching climate commitments, and the need for a shared reporting methodology. The involvement of neutral facilitators like the Global Maritime Forum, diverse stakeholders including financial actors, charterers, and ship owners, plus academic input has helped improve standards’ ambition and build trust. While it is challenging to attribute improvements to any single factor, the research suggests that landscape changes combined with clear policy intentions, can be a catalyst for private sector action and standards.
These findings come at a time when the Climate Action in Shipping report by UCL Energy Institute Shipping and Oceans Research Group is already showing the sector is ‘off track’ to meet its 5% zero-emission fuel target by 2030, particularly in ‘finance’ and ‘demand’ themes. With the Revised IMO GHG strategy and the policy measures recently approved in IMO’s Net Zero Framework, set for entry into force in 2027, private standards that are only in line with IMO compliance, will struggle to remain relevant without reform and improvement. For meaningful impact, private standards must rapidly improve in areas where they’ve fallen short – especially in setting higher ambition levels and enhancing transparency to stimulate greater responsibility and effectiveness in mitigating climate risk.
Link to full report: Marine Policy, Volume 179, 2025, DOI: 10.1016/j.marpol.2025.106707
About UCL Energy Institute
The UCL Energy Institute hosts a world leading research group which aims to accelerate the transition to an equitable and sustainable energy and trade system within the context of the ocean. The research group’s multi-disciplinary work on the shipping and ocean system leverages advanced data analytics, cutting-edge modelling, and rigorous research methods, providing crucial insights for decision-makers in both policy and industry. The group focuses on three core areas: analysing big data to understand drivers of historical emissions and wider environmental impacts, developing models and frameworks to explore energy and trade transition to a zero emissions future, and conducting social science research to examine the policy and commercial structures that enable the decarbonisation of the shipping sector. For more information visit www.shippingandoceans.com
