Exploring financiers' beliefs and behaviours at the outset of low-carbon transitions: A shipping case study

Ship financiers play an important role in the shipping industry's transition to a low carbon economy as they shape the financing terms provided to shipowners and the type of assets that are financed, but their transition-related beliefs are unclear. This paper proposes a novel theoretical framework which categorises financiers during low-carbon transitions into five archetypes. It also provides novel empirical insights on the beliefs and ambitions of shipping financiers regarding their future role and the risks to their assets using semi-structured interviews with ten financiers and two shipowners. The results show that the majority of interviewees expressed an ambition to support incumbent shipowners in the transition, but expressed the need for regulation to ensure financiers properly measure climate risks (e.g. the EU taxonomy and differentiated capital requirements for green and brown assets). This highlights the potential, but also the limits, of voluntary initiatives from financiers to promote green investments.