Cover Story Andreas Sohmen-Pao

Non-binary thinking

Andras Sohmen-Pao urges his shipowning peers to think more outside the box

Along with Maersk’s Soren Skou, arguably there are few shipowners who are so vocal or determined when it comes to shipping’s decarbonisation that this issue’s cover star. Also like Skou, our cover star is one of shipping’s great consolidators.

Andreas Sohmen-Pao is chairman of BW Group, one of the world’s largest maritime conglomerates with interests in tankers, bulk carriers, gas, offshore and latterly renewables.

Always someone who comes across as an eloquent, thoughtful and intelligent speaker, SohmenPao, educated at Eton, Oxford and Harvard, has been Singapore’s most high profile shipowner for years, a position he is increasingly taking up on the world stage.

Speaking as keynote at CapitalLink’s 16th International Shipping Forum late last month, Sohmen-Pao discussed shipping’s all too often narrow mindset and the need to think outside the box.

“I think we spend a lot of time these days thinking in binary terms - either, or - the false dilemma, the false dichotomy, where we say either we have energy security or we have climate change mitigation, it’s impossible to have both,” SohmenPao told delegates, stressing: “Either we use traditional fuels or we can’t progress as humankind.”

Sohmen-Pao, the third generation at the helm of the BW Group, argued that the Ukraine war had shown the imperative of energy security and that without it, it would be impossible to tackle climate change thanks to potential social instability. He said one likely outcome of the war would be a boost to renewables as countries seek alternative energy sources urgently.

“This is how we define ourselves as an organisation in that we want to deliver energy for the world today and find solutions for tomorrow so we want to be an organisation that can walk and chew gum,” SohmenPao said.

On the war in eastern Europe, Sohmen-Pao said the industry needed to be careful how it responded and to calibrate accordingly - a corporate position being far

“We want to be an organisation that can walk and chew gum”

different from a person point of view.

“I think as individuals we have the right to feel as indignant as we want to - I am shocked by what I am seeing in Ukraine and I think it is very disturbing,” Sohmen-Pao said, going on to explain: “I think states and politicians have the right to make laws because they have access to good information and consequences. Corporates are in a very tricky position in the middle. We can’t act purely on emotions because we represent a small community and we also don’t have the right or information to make laws so if we all decide to make our own laws in defiance of international laws that leads to chaos and that is where corporates have a tricky role right now to calibrate an appropriate response.”

Among his many titles, Sohmen-Pao, 50, is chair of the Singapore-headquartered Global Centre for Maritime Decarbonisation (GCMD), an organisation that has been making lots of headlines of late. Like the Mærsk Mc-Kinney Møller Center for Zero Carbon Shipping in Copenhagen, the GCMD, explained Sohmen-Pao, is a collaborative effort, bringing together multiple stakeholders, rather than representing a singular point of view.

“One of the aspects of the center that we have in Singapore is to really focus on doing as opposed to only researching because I think it’s very easy to get stuck at the level of theory and it’s really important then to to be taking concrete action,” he said, giving the safe handling of ammonia, a likely future fuel, or carbon capture onboard as examples of taking action today.

Sohmen-Pao does not buy into the thesis that shipping struggles to punch above its weight, that because it does not control what happens upstream it is not in control of its green destiny.

“In charting our future fuels for shipping we can help to shape and inform what happens in other industries, so you know some of the aspects of future fuels - how you move them, how you consume them - has applicability for other industries,” Sohmen-Pao argued.

Quizzed about the role China will play in the global decarbonisation transition, Sohmen-Pao said of the land where his famous grandfather, Sir YK Pao, hailed from, that because of superpower dynamics, big emerging countries are sometimes hesitant to sign up to multilateral institutions which they’re not leading because it restricts their freedom to manoeuvre. The Chinese government is pragmatic, and want to be able to manoeuvre in the event - as now - some energy prices spiral. Plenty of other nations such as Germany have to wrestle with this pragmatism versus idealism energy debate, Sohmen-Pao pointed out, bringing the conversation back to the opening focus, namely the balancing act between energy security and climate change.

On further consolidation, for which Sohmen-Pao has been a leader in the non-container space for the past five years, the BW boss said: “There are great opportunities for it because the landscape is shifting so much and so I think we are seeing and we’ll continue to see new constellations of companies coming together, working together.”

The next Capital Link event takes place in Athens in May. ●

“In charting our future fuels for shipping we can help to shape and inform what happens in other industries”