Leveraging ESG Investing with Digital Transformation to Enhance the Carbon Intensity Indicator

Abstract

This thesis examines how Digital Transformation and Environmental, Social, and Governance investing can collectively address the limitations of the International Maritime Organisation’s Carbon Intensity Indicator, a key structure for assessing a ship's carbon emissions. While the CII aims to incentivise decarbonisation, its efficacy is constrained by data inaccuracies, operational inconsistencies, and fragmented stakeholder accountability. This study examines how DT technologies, such as the Internet of Things and blockchain, can improve the transparency, reliability, and efficiency of both the CII framework and ESG investing. At the same time, it explores the role of ESG investing in promoting the adoption of these digital solutions within the shipping industry, while also influencing the governance of CII. Using a qualitative research methodology that includes thematic and comparative analysis, the thesis synthesises information from regulatory frameworks, case studies of leading shipping companies, and evaluations by ESG rating agencies. Findings reveal that the interplay between DT and ESG investing can enhance stakeholder collaboration, balance the identified environmental and economic priorities, and create a cohesive and practical way for working towards decarbonising through CII. The research emphasises the need to move away from fragmented, traditional approaches, advocating for the integration of financial incentives and technology to usher in a new era of sustainability.