Norwegian Cruise Line Holdings (NCLH) has published its 2022 Environmental, Social and Governance (ESG) report and Sustainability Accounting Standards Board (SASB) index.
This forms part of the Group’s global sustainability programme, Sail & Sustain.
The report highlights the progress on NCLH’s ESG strategy and goals, including its efforts across the five pillars of Sail & Sustain – Reducing Environmental Impact, Sailing Safely, Strengthening our Communities, Empowering People and Operating with Integrity and Accountability.
“We recognize the need for corporations to take action to help address global challenges, including climate change and sustainability, and at Norwegian Cruise Line Holdings we are committed to doing our part by operating in a way that is socially responsible, respectful of the environment, and drives a positive impact on society,” said Harry Sommer, NCLH’s President and CEO-elect (pictured).
“Our Sail & Sustain programme is key to moving our business forward– it goes hand-in-hand with delivering long-term value for the company and its stakeholders,” he added.
“Over the past year, we continued to make great progress with new goals and initiatives across our Sail & Sustain focus areas, as we help chart a path to a more sustainable future,” said Jessica John, Vice President of ESG, Investor Relations, and Corporate Communications. “This year’s report highlights not only these advancements but also our commitment to increase and strengthen our disclosures each year to provide our stakeholders with critical transparency.
“Whether it’s through our plan to pursue net zero by 2050 or our efforts to support the communities we live in or visit worldwide, we’re set on finding innovative ways to Sail & Sustain,” she said.
Among the many ESG initiatives covered in the report, key highlights from the past year include:
Reducing Environmental Impact
- Ambitious climate action strategy and targets to reduce greenhouse gas (GHG) emissions: NCLH recently announced its revamped climate action strategy focused on efficiency, innovation and collaboration, along with ambitious short- and near-term emissions reduction targets that support the company’s pursuit of net zero by 2050. The company is now targeting a reduction in GHG intensity of 10% by 2026 and 25% by 2030, compared to a 2019 baseline with intensity measured on a per capacity day basis
- Methanol-Ready newbuilds on order: Modified the final two ‘Prima’ class ships, expected to be delivered in 2027 and 2028, to accommodate the use of green methanol as an alternative fuel source in the future. While additional modifications will be needed in the future to fully enable the use of methanol in addition to traditional marine fuel on these ships, this reinforces the NCLH’s commitment to de-carbonise
- Focus on water stewardship: NCLH continues to improve water production rates, while at the same time focusing on efforts to decrease consumption. Across its fleet, 90% of the fresh water used in 2022 was produced on board
- Testing biodiesel fuels: Successfully tested small quantities of biodiesel blend B30, which is 70% marine gas oil and 30% biodiesel, in four of its ships to By the end of 2023, NCLH anticipates more than 20% of its fleet will have tested and operated on biodiesel blends
- Investing in shore power: NCLH currently has 12 ships equipped with shore power capabilities, which allows these ships to connect to onshore electrical power grids to supply much of the power needed while docked when available. The company continues to invest in expanding this technology and expects to have about 60% of its fleet shore-power enabled by year-end 2023 and around 70% by year-end 2025.
- Robust public health programme to protect guests, crew and communities we visit: NCLH operates a comprehensive 24/7 public health and safety programme, working closely with health authorities worldwide to implement and continuously improve policies and procedures that meet and, in many cases, exceed regulations. Crew members are also highly trained in the company’s Outbreak Prevention and Response Plan, designed to mitigate, and help prevent the spread of communicable diseases
- Continuous public health training and education: In partnership with representatives from various government agencies and suppliers, NCLH continues to host public health training through monthly online collaborations as well as annual in-person summits
- Prioritised safety and security efforts: Utmost importance placed on safety and security at sea with third-party audits conducted regularly to verify compliance. Each ship also has a resident Safety Officer, with experience ranging between 10 and 15 years in various roles at sea, and ship crews participate in regular safety training, exercises and drills on board and shoreside.
- Enhanced employee benefits demonstrate commitment to team members: NCLH expanded its suite of employee benefits by adding new Family Care Benefits, which provides fully paid maternity, paternity and adoption leave, as well as family planning assistance for full-time US shoreside team members
- Fostering inclusive workforce where diverse backgrounds are represented and empowered: Across NCLH’s global shoreside workforce, 61% of team members are female, including 47% of managers and above. In addition, across the US shoreside workforce, 67% of team members were under-represented minorities, including 54% of managers and above. In 2023, the company also appointed three new Presidents to lead its brands, all three of whom were internal and ethnically or gender diverse candidates, including the appointment of NCLH’s first female brand President, Andrea DeMarco, to lead Regent Seven Seas Cruises
- Provided training and development opportunities across workforce: NCLH team members logged more than 800,000 hours of training and development across various roles and responsibilities, cementing the corporate philosophy to empower top talent and foster robust career development.
Strengthening Our Communities
- Ongoing corporate efforts to philanthropic contributions: NCLH contributed more than $2 mill in monetary and in-kind donations to non-profit organisations worldwide. This included over $300,000 donated to aid in disaster and crisis relief, including Hurricane ‘Ian’ recovery efforts in Southwest Florida
- Honouring the connection between travel and education: Each year, Norwegian Cruise Line’s Giving Joy programme recognises top educators for their unwavering commitment to inspiring students every day. In 2022, the Giving Joy programme awarded 100 teachers across North America a free week-long cruise for two, valued at over $750,000 collectively, along with thousands of dollars in contributions from NCL and its partners to the schools of the top three grand prize winners
- Offsetting Emissions and Supporting Communities through carbon offsets: NCLH has purchased 1.6 mill carbon offsets to date contributing to 14 projects globally, including in South Korea, Brazil and Turkey. The offsets purchased not only support the company’s de-carbonisation journey but also invest in cleaner energy sources and local job creation in these communities.
Operating with Integrity and Accountability
- Tied ESG metric to compensation: The Board’s Compensation Committee approved the inclusion of an ESG metric for the first time as part of the 2022 short-term incentive (STI) and once again approved the inclusion of an ESG metric in 2023. This metric is tied to the progress made on NCLH’s GHG reduction goals and builds greater accountability across the company to accelerate the progress on ESG goals
- Fostering a culture of ethical conduct: NCLH continuously emphasises the importance of ethical business practices and upholds all team members to a Code of Ethical Business Conduct, which team members are required to review and certify on an annual basis
- Committed to maintaining a strong board with diverse experiences and backgrounds: NCLH welcomed a new board member in 2022, Zillah Byng-Thorne. She brings her extensive technology sector, digital media and e-commerce experience to the board. Currently, the board is around 50% diverse, including 37.5% female and 12.5% under-represented minorities, with an average tenure of 6.6 years.
Sail & Sustain is NCLH’s global sustainability programme centered around its commitment to drive a positive impact on society and the environment, while delivering on its vision to be the vacation of choice for everyone worldwide.
This programme is structured around five pillars developed through cross-functional collaboration with key internal and external stakeholders. These include: Reducing Environmental Impact, Sailing Safely, Empowering People, Strengthening our Communities and Operating with Integrity and Accountability.