Yang Ming Marine Transport Corp

Yang Ming has invested USD 9 million in 2021 in R&D into low-carbon technologies, equivalent to 22% of its total R&D investments. The company has invested in 17 different projects. Thirteen of these projects are digital solutions for transport optimisation, three are in ship design to improve efficiency and one is in the evaluation of alternative fuels. To meet the sectoral expectation for aligning with a 1.5°C scenario, Yang Ming needs to increase its R&D spending on low-carbon innovation as the total spending is below 1% of the total revenue.

Yang Ming has implemented board-level oversight of climate change, but there is no evidence that its board has climate expertise. It does not incentivise low-carbon performance through executive compensation. It can improve the likelihood of a successful low-carbon transition by aligning its incentives with its decarbonisation commitments. Yang Ming has set a target to reduce absolute emissions by 50% by 2050. It aims to achieve this through fleet modernisation and improving ship efficiency. It has not conducted climate scenario analysis to inform its transition plan and ensure the plan’s ambition is sufficient for a 1.5°C pathway.

Yang Ming reported a decrease in its sea freight emissions intensity from 0.051 kg/TEU-km in 2016 to 0.043 kg/TEU-km in 2020. This decrease is likely driven by the increase of more efficient ships within its fleet. However, the emissions intensity is calculated using the company’s shipping capacity and not the company’s shipping activity. The unused capacity of the ship is not taken into consideration in the calculation. Therefore, the reduction in emissions intensity could not be assessed against a 1.5°C scenario. For transparency, Yang Ming should publish its emissions intensity based on the business activity of the company.

Yang Ming set a near-term target to reduce the emissions intensity of its ships by 40% by 2030, compared to 2008 which has already been achieved. No new short-term target has been set. By 2050, the company aims to reduce the emissions intensity of its ships by 70%. These targets are based on the capacity of the company’s ships and not the company’s activity. It has also set a target to reduce absolute emissions by 50% by 2050 compared to 2008.

Yang Ming’s transition focuses on fleet modernisation and improving ship efficiency. For example, it has worked with universities to build energy efficiency systems for new vessels. The company acknowledges the need for alternative fuels but does not commit to using them in its operations.

Yang Ming’s has purchased ten new ships that are more energy-efficient, six of which were put into operation in 2021. However, these ships are powered by heavy fuel oil or gasoline. It is unclear how the company plans to decarbonise these new ships and there is no evidence of the use of alternative fuels in its operations.

The emissions intensity of Yang Ming’s fleet decreased significantly between 2016 and 2020 through fleet modernisation. However, the company reported its emissions based on the capacity of the ships and not on weight of freight transported. Therefore, past emissions trends could not be assessed against a 1.5°C scenario.

Yang Ming has improved the efficiency of its ships over the past 14 years by nearly 60%. This will help it achieve its medium-term target. However, the company’s transition plan lacks sufficient detail or financial commitments to align to a 1.5°C scenario.

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 or 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 educational opportunities for workers and affected stakeholders. For instance, it partners with several universities to educate students, and provides training programmes to its staff. 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 upskill.

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 and the ILO fundamental rights at work. However, no evidence was found of the company’s process to identify, assess and mitigate salient human rights risks in its own operations and supply chain. Moreover, no evidence was found of the company disclosing the stakeholders whose human rights have been affected by its activities.

The company discloses some fundamental workforce diversity information, but no other evidence of the company’s policies or commitments related to key decent work issues were found in the public domain. These issues include the provision of secure, safe and healthy workplaces, where workers are fairly remunerated and have a meaningful say in decision-making.

The company commits to protecting personal data. However, no evidence was found of a privacy statement regarding the collection, sharing and access to personal data or information on other key ethical business topics including tax, bribery and corruption, and lobbying and political engagement.