Category: 3. Business

• Since the banking turmoil of 2023, the Committee has worked to strengthen supervisory effectiveness in relation to material risks that could result in financial losses, impacting the safety and soundness of financial institutions.
• This work covers the supervision of liquidity risk and interest rate risk in the banking book (IRRBB), banks’ business models, and the exercise of effective supervisory judgment.
• The Committee has facilitated information sharing on a range of supervisory practices to support supervisors toward supervising these risks in the banks that they oversee, including tailoring their requirements to align with each financial institution’s size, complexity and risk profile.

The Committee has been actively facilitating roundtable discussions and workshops to support supervisors in their day-to-day work in relation to the material risks that impact the safety and soundness of financial institutions. Areas of focus included: (i) interest rate risk and liquidity risk, along with various forms of concentration risk; (ii) the build-up and interrelated nature of various individual risks and how they can compound one another; (iii) ensuring a bank’s risk management aligns with its business model; (iv) effectiveness of senior management and board oversight; and (v) banks’ responsiveness to supervisory feedback and recommendations.

Supporting supervisory decision-making and effectiveness will contribute to global financial stability.  This can be advanced by fostering a better understanding of diverse supervisory approaches and practices worldwide, benefiting both supervisors and banks. The Committee has developed practical supervisory tools and published a working paper on supervisory effectiveness to support supervisors in their day-to-day work that supplement but do not change or replace existing Basel standards or guidelines. 

Supervision of liquidity risk

The Principles for Sound Liquidity Risk Management and Supervision provide a strong basis for the supervision of liquidity risk taking into consideration the size, complexity and risk profile of a bank.  Information sharing on supervisory approaches covered supervisory practices relating to liquidity monitoring indicators in areas such as contractual maturity mismatch, concentration of funding, monetisation of assets, intraday liquidity, funding costs, and liquidity risk in crises, as well as current supervisory practices related to banks’ contingency funding plans. 

Supervision of IRRBB

The IRRBB standards lay out the Committee’s expectations for banks’ identification, measurement, monitoring and control of IRRBB, taking into account the size, complexity and risk profile of the bank, as well as its supervision. Information sharing include the supervision of banks’ modelling assumptions, such as general considerations, the adequacy of non-behavioural and behavioural assumptions, scenario selection, the treatment of non-maturity deposits, and the supervision of embedded gains and losses.

Business model analysis

The Committee’s work has focused on sharing information on existing supervisory approaches to a variety of banks’ business models ranging from universal banks to those with more concentrated activities. It also considers topics such as entity-level versus activity-based supervision.

Effective supervisory judgment

Effective supervisory judgment depends on supervisors’ ability and willingness to actively identify weaknesses in banks and to take and enforce prompt supervisory actions.  The Committee’s work has focused on sharing information on how supervisors approach the application of supervisory judgment in day-to-day supervision, as well as broader observations on effectiveness related to the organisation of the broader supervisory authority. Additional focus areas for detailed information sharing include the powers and tools that supervisors have at their disposal, the role of supervisory risk appetite, and the allocation of supervisory resources based on the size and complexity of a bank. The Committee published a working paper on Lessons on supervisory effectiveness – a literature review in July that provides insights from academic and policy work on supervisory effectiveness.

When insights fuel ambition

Pace, scale, and the expectations of worldwide growth. As a truly global retailer, Primark’s potential is unlocked in partnership with Maersk.

“You need to work with somebody who has the knowledge and the experience to accelerate the business”, says Nigel Jones, Chief Operating Officer at Primark. “It isn’t the data itself you really want, it’s the insight you need.”

Circumstances shift fast and often without warning

For Primark, every decision must address immediate challenges while supporting long-term ambitions with a clear direction. Beyond reliability, capacity and experience, Maersk contributes with insight that makes a real difference. Maersk adds value through global market intelligence, demand forecasting, and end-to-end visibility. This gives Primark the clarity to plan smarter and act faster. With integrated logistics, Primark gains the flexibility to stay ahead of shifting trends and customer needs. The partnership builds a supply chain that is not only reliable but ready for whatever comes next.

The global shift to renewable energy is essential for strengthening energy security and independence and for countering climate change and biodiversity loss. With countries continuing to rely on offshore wind and other renewable technologies, the ability to develop, construct, and operate responsibly is becoming a decisive factor for success.

Ørsted’s vision is to create a world powered entirely by green energy, and our strategic aspirations include remaining the undisputed leader in offshore wind and being a globally recognised sustainability leader. 

Next step: value-chain emissions

By 2025, we had already reduced the emissions intensity of the energy we generate and our operations (scopes 1 and 2) by 98 % compared to a 2006 baseline.  

Now we’re working to reduce the remaining emissions across our value chain (scopes 1–3), mainly across the manufacture, installation, transport, and operation of our renewable energy assets. 

To achieve this, we’re working with suppliers to adopt new technologies that accelerate decarbonisation in sectors we rely on, such as steel and shipping. We are developing circular solutions with key suppliers to reduce the need for virgin materials. And we’re working with all key Ørsted suppliers to bring down our scope 3 emissions. 

_{Note: Moody’s Corporation is comprised of separate divisions. Moody’s Ratings publishes credit ratings and provides assessment services on a wide range of debt obligations, programs and facilities, and the entities that issue such obligations in markets worldwide, including various corporate, financial institution and governmental obligations, and structured finance securities. Moody’s Ratings products are set out here. All other products and solutions described on this site are provided by Moody’s, a global provider of data and information, research and insights, and decision solutions.}

• New report from the Poseidon Principles reveals the financial sector’s alignment with shipping’s minimum net-zero climate goals has improved by nearly 8 percentage points, despite more demanding year-on-year emissions reduction targets. 

• Signatories, which represent almost three-quarters of the global shipping finance portfolio, disclosed 95% of their eligible portfolio activity in 2025, up from 93% in 2024. 

• Poseidon Principles will expand to include more financial institutions—from private equity and hedge funds to capital markets underwriters—with an aim to further increase climate transparency in shipping finance.  

 15 December 2025, Copenhagen – Ship financiers’ lending portfolios are getting closer to reaching climate alignment with the International Maritime Organization’s (IMO) ambitious decarbonisation trajectories, with average scores against the ‘minimum trajectory’ improving by nearly 8 percentage points.

The news was revealed today in the Sixth Annual Disclosure Report of the Poseidon Principles, the world’s first sector-specific framework for financial institutions to assess and disclose the climate alignment of their shipping portfolios. With 36 signatories across 14 countries, representing nearly three-quarters of the world’s ship finance portfolio, the initiative establishes a benchmark for the industry in line with the IMO’s goal of net zero greenhouse gas emissions from international shipping by 2050.

This year, signatories disclosed 95% of their eligible portfolio activity, up from 93% last year and the second-highest level since reporting began.

Paul Taylor, Vice Chair of the Poseidon Principles and Global Head of Maritime Industries, Societe Generale, said: “Transparency is key. It fosters collaboration between financial institutions and shipowners, and guides capital toward more efficient vessels and cleaner fuels. The results of this year’s report show encouraging, measurable, real-world momentum and progress in action. Signatories are disclosing the vast majority of their portfolios, showing increasing collaboration between financiers and clients, and climate alignment scores have moved closer to the IMO’s decarbonisation pathways. This progress is particularly striking considering the pathways become more stringent year-on-year. In short, the Poseidon Principles continue to demonstrate the power of financial transparency in guiding the shipping industry’s transition.”  

The report shows that emissions data is increasingly informing credit decisions and innovative financial products, such as sustainability-linked loans. Operational efficiency, retrofits, and emerging fuel pathways are noted as key drivers of score improvements this year, and the scores were also impacted by evolving methodologies and external factors, including rerouting vessels on longer routes and disruptions in supply chains. The framework positions financial institutions as active partners in the industry’s transition.

2025 Annual Disclosure Report key findings   

• Increasing transparency: Twenty-nine signatories disclosed 90% or more of their in-scope portfolio, while nine signatories achieved 100% reporting, the highest number of signatories to hit these two respective targets to date. The average disclosure rate across all signatories was 95%. 

• Improved climate alignment: While the average scores remain misaligned with the IMO’s net-zero pathways, substantial year-on-year improvements were recorded. Against the IMO’s ‘minimum trajectory’, the scores went from just over 19% misaligned last year to just under 12% misaligned this year, representing a nearly 8 percentage point improvement. Against the IMO’s ‘striving trajectory’, scores went from 25% misaligned to just over 18% misaligned. 

• Meaningful progress in the cargo and passenger segments: The cargo and passenger segments saw improvements from 14% to 6% misaligned, and from 38% to 26% misaligned, respectively. These shifts demonstrate advances in vessel efficiency, increased uptake of low-emission fuels, and the entry of more efficient dual-fuel vessels into the fleet.  

 It is important to note that the decarbonisation trajectories set by the 2023 IMO’s GHG Strategy get more challenging to reach each year, making it more difficult to achieve alignment as time goes on. Seeing improvements year-on-year is promising, but additional efforts are still needed to reach milestones in 2030, 2040, and 2050.

Reinforcing the initiative as an established, globally recognised standard for shipping finance, the Poseidon Principles methodology has been included as an acceptable method to set near-term and long-term portfolio alignment targets as part of the Science Based Targets initiative’s Financial Institutions Net-Zero Standard. 

Associate membership expansion

Since 2019, the Poseidon Principles have matured into a globally recognised benchmark for transparent, industry-wide climate reporting that has been replicated by other critical sectors, such as steel, aluminium, and aviation. Now, there is a willingness to go further in bringing other institutions on board. 

In addition to the lenders, lessors, and financial guarantors historically represented in the signatory list, the Poseidon Principles are now expanding to offer associate membership to a broader range of financial institutions, including private equity, hedge funds, and capital markets underwriters. This expansion will increase the initiative’s potential impact by engaging the wider financial community in the framework without initial reporting obligations. This expansion will strengthen the Association’s influence across the full maritime finance ecosystem and support a broader, more consistent approach to emissions accountability.

Michael Parker, Poseidon Principles Chair and Chairman of Global Shipping & Logistics, Citi, said: “The Poseidon Principles Annual Disclosure Report has become a vital pulse check for the industry, showing how global lending portfolios measure up against the climate ambitions set by the IMO. This consistent transparency gives us a clear view of progress across approximately three-quarters of global ship finance. Without it, we would have no meaningful way to understand how far we and the industry have come, or how far we still need to go.   “Today, the Poseidon Principles are taking another important step to deepen that transparency. By opening Associate Membership to any institution providing or arranging capital for the maritime sector—including private equity firms and hedge funds—we are broadening the lens through which climate considerations can be directly integrated into financing decisions. This expansion supports a broader commitment to transparency and accountability across finance and reinforces the sector’s contribution to a more sustainable future for shipping.”

 The latest report cements the critical nature of finance in supporting the shipping industry’s shift toward a zero-emission future while emphasising the crucial role transparency plays in measuring climate alignment.

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Media contact: Nicole Schlichting, (Interim) Senior Communications Manager – PR & Media 

M: +45 31 26 19 25 

E: nsc@globalmaritimeforum.org