Growth strategies pinned to ESG mast

The ports are putting an increased focus on environment, social and governance initiatives as they seek continued community, government and investors’ support to operate and expand.

Limeburners Bay near GeelongPort. The Victorian port is working with Deakin University’s Blue Carbon Lab to study how coastal wetlands can mitigate climate change. From left, marine ecologist Maria Palacios from Deakin, and the port’s counsel Jaclyn Masters and environmental specialist Nelson Taylor. Picture: Mark Wilson

Australian ports are putting an increased focus on environment, social and governance initiatives as they seek continued community, government and investors’ support to operate and expand.

Jason Sprott, director of ports advisory firm Sprott Planning & Environment, says community expectations from businesses have changed and ports are responding with ESG initiatives.

“There’s a very, very strong expectation that ports are across these issues. And pleasingly, they are. They’re all stepping up, which is fantastic,” he says.

Ports are taking action to protect the marine environments in which they operate as well as the land on which they sit. They are working to maintain air quality around the port and reduce noise and are focused on waste management, clean shipping and reducing their own emissions as well. That is just the environment part of ESG and ports are also ensuring they are acting on the social and governance aspects as well.

For the workers, they have a strong focus on culture and leadership as well as safety and health and wellbeing. “Diversity is a really big issue in ports. Traditionally in the Australian market and probably globally it’s been a fairly male-dominated environment. But we’ve seen massive change in that in the last 10 to 15 years and we’re getting a lot more diversity in terms of gender but also in terms of age and ethnicity,” Sprott says.

Many ports have also formed partnerships with local traditional owners and have reconciliation plans.

Ports have always tried to comply with local laws and regulations but are taking a step beyond this in their ESG initiatives.

“It’s now being taken to the next level because they know that those elements are absolutely critical to their continued operation and success, and they know that financial investors and financial markets now have got a much closer eye on what’s happening with these major infrastructure nodes,” Sprott said.

Certainly this is the case at the Port of Brisbane.

“We’re in quite a visual space in Brisbane in Moreton Bay, which has a high ecological value and a high community value as well,” says Craig Wilson, head of sustainability at the port. “We’re a private port in Australia and we’re owned by major infrastructure investment companies,’’ he says.

“They’re securing their funding through pension and superannuation companies and a lot of people these days are ticking the responsible investment box, so we have to demonstrate to our shareholders that we’re a responsible company.”

The Port of Brisbane has what it calls a Target Zero strategy – which is zero waste to landfill by 2030, zero potable water use by 2030 and zero net emissions by 2030.

On emissions, the port is focusing on Scope 1 and Scope 2 emissions, that is, those form its own operations and those emissions related to the electricity it uses.

The major contributor to Scope 1 emissions is from the port’s dredge. Wilson says the port has done all it can to make it as efficient as possible and offsets the remaining emissions from burning fossil fuel by paying a subsidy for the fuel which goes into carbon offsets.

It has installed rooftop solar electricity generation across all the roofs at the port facilities and operates a virtual energy network as well to match solar production against its own consumption.

The Port of Melbourne has a four-pillar sustainability and ESG strategy – people, planet, partnerships and prosperity.

“That includes things like climate resilience in our existing infrastructure and in new developments, reducing carbon emissions for our own operations and across the port supply chain, community engagement and partnerships, and engagement with government and industry, particularly to drive efficiencies in the port supply chain,” explains Melissa Clarkson, head of sustainability.

“We’re focused on biodiversity and natural capital management, noise and air quality and, obviously, the safety of our people and our contractors and, like most businesses, on employee engagement and diversity and inclusion.”

The Port of Melbourne is owned by a consortium of local and international investors including Brisbane-based QIC, the federal government’s Future Fund and Canadian pension fund OMERS.

These long-term investors are very focused on sustainable outcomes and sustainable infrastructure, says executive general manager, strategy and planning Caryn Anderson.

But these are just some of the many stakeholders the port has to deal with. There are employees, who Anderson says are passionate about the port’s stewardship obligations; the state government, which owns the land on which the port operates; and tenants, which are co-investors in the port.

“We are a city port as well so the community is a very strong stakeholder. Ultimately, the port services the Victorian community to be able to provide goods and services,” Anderson says.

“It’s really critical that we engage with those communities and make sure that we’re aligned to their interests in terms of how we’re going about our operations and our development. That’s a really important part of our broader sustainability strategy.”

The Port of Melbourne has several sponsorships and partnerships with local community groups and has a port education program which aligns with the Victorian schools curriculum.

It is also very focused on supply chain, including human rights and modern slavery, but also engagement with Indigenous suppliers, small businesses, looking at environmental impacts in the supply chain as well. It’s an example of how it makes sure all of the business’s practices are aligned with its ESG strategy.

“It makes good business sense. If we focus on driving efficiency and productivity in the end-to-end supply chain, that has environmental, social benefits associated with it,” Anderson says.

NSW Ports’ recently launched sustainability strategy includes commitments to improve efficiency and environmental outcomes by shifting more goods to rail and to invest in smart technology to monitor and manage environmental factors, such as weather.