Two major shareholders voice
criticism of Maersk's declaration to disregard EU shipbreaking rules. Nordea
Wealth Management wants to know why Maersk refuses to comply with EU
regulations, scheduled to take effect in 2017, and Norway's KLP calls the
stance "unduly aggressive".
Maersk Line's rejection of EU regulations for
responsible ship recycling came as such a surprise to one of the carrier
group's major shareholders that an explanation is now being demanded from
Maersk. On Thursday afternoon, Maersk held an orientation for several critical
shareholders who wanted to know why some of Maersk's vessels ended up on the
beaches of Bangladesh a few years ago, at a time when the Danish carrier was otherwise
publicly against the controversial beaching method of shipbreaking.
Nordea Wealth Management was among the
critics along with Danish pension funds PFA and ATP. But one thing is how
Maersk has handled scrapping policy thus far, and another thing is how the
world's largest container carrier will handle it going forward, now that the
global fleet is in serious need of scrapping due to the crisis in the industry.
The European Union is preparing regulations
that mean all vessels flagged in Europe must use shipbreaking facilities
approved by Brussels. The rules take effect in 2017, but Maersk Line has
already stated to ShippingWatch that the carrier will re-flag vessels if
necessary, referring to the possibility that EU regulations will block Maersk
from using scrapping yards in Alang in India where the carrier is now having
its first two vessels dismantled.
Shortly after major shareholders attended
Maersk's orientation yesterday, Sasija Beslik, Head of Sustainable Finance at
Nordea Wealth Management, said to ShippingWatch:
"We understand that the company
evaluates the situations ship by ship and in relation to the value of each
ship. Our stance is that companies must follow the laws and regulations
applicable in the countries of operation, and that companies must continuously
try to maintain minimum requirements within environmental and social issues. We
would like more information about the out-flagging of vessels due to EU
regulations."
On top of Nordea Wealth Management's criticism
yesterday, Norwegian asset manager KLP Kapitalforvaltning is now voicing its
opinion on the matter as well.
"I'm surprised about this stance from
Maersk. It seems unduly aggressive when the EU list of approved yards and
shipbreaking facilities has not even been presented yet. The question is
whether the facilities used by the company in Alang will meet the EU
requirements for responsible ship recycling and thus gain a spot on the list.
This is what Maersk should focus on, instead of preemptively threatening to
re-flag. This was not something we discussed yesterday, when Maersk presented
its explanation for the scrapping that has taken place in Bangladesh and India,
but I'm curious to hear what Maersk has to say about it," says Annie
Bersagel, consultant on responsible investing at KLP, to ShippingWatch.
Individual decision for each
vessel
Already at the end of May, Maersk Group's
Head of CSR, Annette Stube, told ShippingWatch that Maersk would not
acknowledge the EU regulations if they were an obstacle to the carrier's
scrapping plans:
"This is something we will consider from
case to case, but it is clear that if it is a flag from Denmark or another EU
country which hinders our ability to use the yards in Alang, which we believe
deliver a responsible shipbreaking service, then we will consider changing the
flag," as she said.
This was one week after the 20-year-old
container ship Maersk Wyoming arrived at the mudbanks of Alang to be dismantled
and ultimately sold as scrap steel, for better prices than Maersk could earn at
its previously used yards in Turkey and China. This was just the first in a
long line of vessels that Maersk Group will now send to Indian shipbreaking
facilities after having banned Alang for many years.
Maersk considers flagging out
ships in response to EU rules
The four yards that Maersk now deems to be
sufficiently up-to-par also include the yard Shree Ram, which is the scrapping
facility on the beach where Maersk Wyoming is being dismantled. All four yards
comply with the Hong Kong Convention and have been certified by classification
companies but it is far from certain that the EU will include them on its
approved list.
Maersk is working to get many of the world's
large container carriers to take its lead and support the decision to utilize
the Hong Kong-certified yards in India. One of its major competitors, the
world's fourth-largest container carrier, Hapag-Lloyd, is of the opposite
opinion, however, and plans to comply with the EU's upcoming regulations, the
carrier told ShippingWatch this Monday.
Taking responsibility
In Danish daily Politiken Tuesday, Maersk
explains that the company will handle the scrapping of vessels itself if these
ships are no longer profitable to operate, in order to make sure that vessels
sold for scrap are dismantled responsibly. The company has furthermore
presented a document to Politiken stating that recycling will only be done
according to Maersk's own recycling rules, which set a series of requirements
in terms of ensuring responsible scrapping.
"We are actively working directly with
shipbreaking facilities in Alang in India in an effort to improve conditions
there and to influence the industry. It is therefore of course disappointing
that we, in spite of these initiatives, see examples of having pushed parties
in the opposite direction of our own policy. Going forward, we will ensure that
there is a very strong incentive for responsible recycling in our sales
contracts," Chairman Michael Pram Rasmussen tells Politiken.
ShippingWatch asked the two other major
shareholders, PFA and ATP, for a comment yesterday on Maersk's rejection of EU
regulations, but they have not yet responded.
Source: shipping
watch. 21 October 2016
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