Hurtigruten Group receives leading ESG ranking in cruise industry

Hurtigruten Group (HRG) has received an industry-leading ESG Risk Rating of 19.7 (Low) following an assessment by Morningstar Sustainalytics, an ESG research, ratings and data firm.

ESG, or ‘environmental social governance’ is a term that refers to corporate performance evaluation criteria that assess the robustness of a company’s governance mechanisms and its ability to effectively manage its environmental and social impacts.

With ratings categorized across five risk levels, Hurtigruten Group is the only cruise company to be awarded a ‘Low ESG Risk Rating’ and ranks fourth (out of 127 companies) in the Travel, Lodging and Amusement sub-industry category.

The rating, from Morningstar Sustainalytics, reflects the low risk of the Company experiencing material financial impacts from ESG factors.

“This rating is a result of our company-wide focus on emissions, nature, community and people,” CEO, Hurtigruten Group, Daniel Skjeldam, said.

“We have made significant strides over the past year, investing 66 million euros in emissions reduction.

“Our pioneering Green Bond, issued in 2022, has enabled us to finance ongoing environmental upgrades, including converting our fifth battery hybrid-powered ship.

“Simultaneously, we strengthened governance with executive compensation linked to ESG targets, a new whistle-blower policy and improved supply chain control, emphasizing local procurement.”

In its latest ESG rating report, Morningstar Sustainalytics stated, “The company [Hurtigruten Group] is at low risk of experiencing material financial impacts from ESG factors, due to its medium exposure and strong management of material ESG issues.

“The company is not publicly held, which reduces its corporate governance risk compared to its peers. Although the company has a moderate level of controversies, its favourable risk assessment is primarily due to its above average policies and programmes.”

Hurtigruten Group – consisting of Hurtigruten Norway, Hurtigruten Expeditions, and Hurtigruten Svalbard – seeks to change the industry’s approach to sustainability.

It was the first cruise line to ban heavy fuel oil (2009) and single-use plastics (2018). In 2019, Hurtigruten Expeditions launched the world’s first battery hybrid-powered cruise ship and has since added two more.

In 2022, Hurtigruten Norway converted its first battery hybrid-powered ship, with one more joining the fleet in 2023 and a third planned for 2024. The conversions are part of a 100-million-euro green upgrade that will reduce CO2 and NOx emissions by 25 per cent and 80 per cent concurrently. This June, Hurtigruten Norway’s first-of-kind Sea Zero initiative revealed early concept plans for the world’s most energy-efficient cruise ship.

“In addition, our Svalbard operations have made considerable progress in reducing their impact, deploying two electric tour boats and eight electric snowmobiles,” Skjeldam, said.

“We are working towards becoming cleaner, greener, and quieter.”

The Group released its 2022 ESG Report in May this year, advocating for increased transparency and prioritization on emissions reductions over carbon offsetting.

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Daniel Skjeldam Hurtigruten Group Morningstar Sustainalytics