NYK issues first green bond from the shipping sector

This briefing by the Climate Bonds Initiative analyzes the first green bond issued in the shipping sector by Japan's Nippon Yusen Kaisha (NYK) on 24 May 2018. While the bond finances lower-emission LNG-fuelled ships, the author argues that LNG is an incremental improvement that fails to meet the steep decarbonization trajectories required by the Paris Agreement and the IMO's 2030 targets.

• On 24 May 2018, Japan's Nippon Yusen Kaisha (NYK) issued the first green bond in the shipping sector, valued at JPY10bn (USD92m) with a 5-year term. The bond's proceeds are used to finance and refinance LNG-fuelled ships, LNG-bunkering ships, ballast water management systems, and SOx scrubber systems.
• The transition to LNG-fuelled ships provides limited greenhouse gas (GHG) reductions that do not meet the International Maritime Organisation (IMO) 2030 target of a 40% cut in GHG-emission intensity. Specifically, NYK's LNG-fuelled and bunkering ships reduce CO2 by 30%, but total GHG reductions (accounting for methane leakage) are only 15-21%.
• The IMO has established international targets for the shipping sector to achieve at least a 40% reduction in GHG emission intensity by 2030 and 70% by 2050, alongside an absolute emission reduction of at least 50% by 2050 compared to 2008 levels.
• Investing in LNG vessels creates a risk of 'lock in' to fossil fuel usage because these ships will operate into the 2030s, potentially delaying the transition to renewable alternatives like ammonia and hydrogen, which are currently in the R&D stage and not yet commercially available.
• Methane leakage during the transport and storage of LNG can negatively impact the GHG profile of these assets, as methane is approximately 28 times more powerful than CO2 in its warming potential. NYK intends to use state-of-the-art technologies to manage these emissions.
• The Climate Bonds Initiative has included NYK's bond in its database because LNG assets are currently the lowest-emission option for long-haul shipping. However, the organization is establishing a Technical Working Group (TWG) and Industry Working Group (IWG), with NYK as a member of the IWG, to develop specific eligibility requirements for shipping green bonds.

APA

Climate Bonds Initiative (2018). NYK issues first green bond from the shipping sector. https://www.climatebonds.net/files/documents/publications/Briefing-NYK-Green-Bond-%E2%80%93-green-enough-for-now-but-not-for-long_2025-02-17-163155_jpar.pdf

Chicago

Climate Bonds Initiative. NYK issues first green bond from the shipping sector. 2018. https://www.climatebonds.net/files/documents/publications/Briefing-NYK-Green-Bond-%E2%80%93-green-enough-for-now-but-not-for-long_2025-02-17-163155_jpar.pdf.

Wikipedia

{{cite report |author=Climate Bonds Initiative |title=NYK issues first green bond from the shipping sector |date=5 June 2018 |url=https://www.climatebonds.net/files/documents/publications/Briefing-NYK-Green-Bond-%E2%80%93-green-enough-for-now-but-not-for-long_2025-02-17-163155_jpar.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{climatebondsinitiative2018nyk, author = {{Climate Bonds Initiative}}, title = {{NYK issues first green bond from the shipping sector}}, institution = {Climate Bonds Initiative}, year = {2018}, month = jun, url = {https://www.climatebonds.net/files/documents/publications/Briefing-NYK-Green-Bond-%E2%80%93-green-enough-for-now-but-not-for-long_2025-02-17-163155_jpar.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }