NYK Line (Nippon Yusen Kabushiki Kaisha) is a publicly listed company headquartered in Japan. In 2021 its revenue was USD 13.47 billion. NYK owns the largest transportation fleet in the world by number of vessels. Its operations also include dry bulk and energy transportation (crude oil and liquified natural gas (LNG)) and air cargo transport. The company operates in 40 countries and regions.
NYK is taking on projects in the renewable energy field to create a new core business. The company aims to build a hydrogen and ammonia supply chain and participate as an infrastructure carrier in the entire offshore wind power value chain in Japan. It plans to invest tens of billions of yen in these projects over the next decade to generate an annual income of several billion yen by fiscal year 2030.
NYK has set a target to reduce its scope 1 emissions intensity by 30% by 2030, this target has been validated by the Science Based Targets initiative (SBTi) against a 2°C scenario. However, this target is not ambitious enough to align with the company’s 1.5°C pathway. Also, the company has a scope 1 net-zero by 2050 target for its shipping operations. However, the 2050 target excludes emissions from the company’s air cargo own operations. Although the company has made progress in achieving its targets, it is not on track to meet them. The company can improve its ambition by setting long-term as well as regularly spaced intermediate targets aligned with a 1.5°C pathway to drive increased action.
NYK decreased its scope 1 emissions intensity by 3% on average annually from 2015 to 2020. This contrasts with the company’s 1.5°C pathway, which requires an annual emissions intensity reduction of 4.5%. The company is projected to greatly exceed its 1.5°C cumulative carbon budget between 2021 and 2035.
NYK has invested in R&D in low-carbon vehicles, specifically ammonia-fuelled vessels. However, the company does not disclose what proportion of its R&D expenditure is invested in low-carbon vehicles and energies. The company should ensure that a significant proportion of its R&D investment is in low-carbon vehicles and fuel development.
NYK is a member of several environmental initiatives, such as the Getting to Zero Coalition. However, the company does not disclose a list of trade associations it is a member of and does not have a publicly available policy governing its interactions with trade associations. The company can increase its credibility by being transparent about its membership of trade associations and by implementing processes to withdraw from trade associations that oppose climate policies.
NYK receives a trend score of =. If the company were reassessed in the near future, its score would likely remain the same. The company is projected to exceed its 1.5°C cumulative carbon budget between 2021 and 2035. Although the company’s emissions intensity decreased between 2015 and 2020, the rate of decline is not aligned with its 1.5°C pathway. The company has a comprehensive transition plan aligned with its 2030 and 2050 targets. Moreover, the company has invested in R&D of zero-emission ships. However, it is dependent on the rapid development of ammonia technologies for its planned transition.
NYK has set a target to reduce its scope 1 emissions intensity by 30% by 2030, this target has been validated by the Science Based Targets initiative (SBTi) against a 2°C scenario. Also, the company has a scope 1 net-zero by 2050 target for its shipping operations. However, the 2050 target excludes emissions from the company’s air cargo own operations.
NYK aims to reach an 18% reduction in emissions through operations optimisation and 12% through digitalisation and fuel efficiency by 2030. The company will slowly introduce LNG vessels and, together with oil-fuelled ships, will be converted to biogas, synthetic methane, and biofuel ships by 2050 to make up for 50% of the company’s fleet. Also, it will invest in R&D for ammonia vessels to make up for the remaining 50% of the fleet.
NYK’s current shipping business model relies on carbon-intensive fuels. The company is focusing on efficiency gains through operational modifications to its current fleet. The company also actively invests in R&D on alternative fuels and ships. It has invested in LNG-powered vessels, which are expected to make up 30% of its total fleet by 2035.
NYK’s scope 1 emissions intensity decreased by 3% per tonne-kilometre on average annually from 2015 to 2020. The reduction was driven by energy efficiency strategies. However, the company’s emissions intensity reduction is not aligned with its 1.5°C pathway, which requires an annual reduction of 4.5%.
NYK has a comprehensive transition plan that accompanies its targets and contains various activities that are compatible with a low-carbon business model. The company aims to provide transportation, logistics and installation services for the Japanese offshore wind power value chain and ammonia supply chains.
No evidence was found of the company’s commitment to social dialogue or of the categories of stakeholders the company engages with on a just transition. Furthermore, no evidence was found to demonstrate the company’s ongoing social dialogue and meaningful engagement with affected stakeholders.
No evidence was found of the company undertaking low-carbon transition planning to mitigate the social impacts of the transition on workers, affected stakeholders and its business relationships. Additionally, no evidence was found to demonstrate the company’s engagement in social dialogue and engagement with stakeholders in its just transition planning.
No public commitment by the company was found stating its intention to create and support access to green and decent jobs as part of the low-carbon transition. Moreover, no evidence was found of the company’s action to promote these jobs in a way that ensures gender balance and inclusion of vulnerable groups. Additionally, no relevant disclosure was found of the company’s assessment of employment dislocation risks.
The company discloses the actions it takes to provide training and education opportunities for workers and affected stakeholders. For instance, it offers training to employees on environmental, social and governance (ESG) topics, risk management and management skills. The company has also established a maritime academy in the Philippines, whose graduates of it hires as employees. However, no relevant disclosure was found of the company embedding equality of opportunity for women and vulnerable groups in these actions. Furthermore, no evidence was found of the company having a process for identifying skills gaps for workers and affected stakeholders or a public commitment to help workers displaced by the transition to reskill- or up-skill.
No relevant disclosure was found to show if the company identifies impacts of the low-carbon transition on social protection for workers and affected stakeholders, nor how it contributes to social protection. Additionally, no evidence was found that the company expects its business relationships to contribute to the social protection of their workers and affected stakeholders.
No relevant disclosure was found to show how the company identifies any misalignment of its lobbying activities with policies and regulations that support the just transition, nor of the measures it takes to address misalignment. Furthermore, no evidence was found that the company lobbies for policies and regulations for green and decent job creation; retention, education and reskilling; and social protection for workers.
The company commits to respecting human rights. However, the company’s Code of Conduct does not disclose a commitment to respect all of the ILO fundamental rights at work. Additionally, no evidence was found within the company’s policy documents stating an expectation for its business relationships to respect all of the ILO fundamental rights at work. Furthermore, the company can strengthen its disclosure on its human rights due diligence process and engagement with affected stakeholders
No evidence was found within policy documents of the company having a commitment to respect worker health and safety or a commitment to gender equality and women’s empowerment. The company has a target to increase female employee participation in an external training programme and it discloses the gender of its workforce by employee category. However, it can increase disclosure on other aspects of gender equality and workforce diversity. Furthermore, the company can strengthen disclosure on its living wage, working hours and collective bargaining practices.
No relevant disclosure was found of a company commitment to protecting personal data of employees and customers, or of the company having a global privacy statement regarding personal data. While the company has a policy prohibiting bribery and corruption, it can increase disclosure on its process to identify bribery and corruption risks and impacts in specific locations and activities. Furthermore, the company can increase disclosure regarding its global tax strategy and its lobbying and political engagement policy.