His mandate is a challenging one. As an ex-broker himself, Armitage is well aware that many intermediaries believe they already have all the bases covered. But he knows that most of them are not current with ESG issues, regulations, new fuels, or carbon-cutting technologies.
His job is to work with broking houses to ensure that they are up to date with latest developments in these fields and, as a result, provide extra value for their clients. And two projects that he is working on now show just how this can work.
One involves an initiative with a major tanker owner that is considering a fleet renewal strategy. The company wants to dispose of tonnage as prudently as possible but it also wants replacement tonnage to be as ready for the future as it can be. He highlights LR’s online Zero Carbon Fuel Monitor as an important tool in this type of analysis.
LR is also working on an initiative with a major liner company client wanting to dispose of several larger container ships as responsibly as possible. At present, options are limited, however LR is engaged in a major project aimed at establishing a green recycling setup that could be scaled up to handle large numbers of end-of-life ships.
“Shipping is a huge net polluter,” Armitage said. “There is no option: we have to do something. The industry is on the cusp of an enormous period of change. Some owners are already on the front foot. But other stakeholders are not yet even on the journey and sections of the broking community, we believe, are amongst them.”
Armitage points out that the broking world is over-populated. As always, owners are inundated with suggestions from intermediaries on ways to make a quick buck here or there, he says.
“But the really successful brokers of the future will be those that can differentiate their offering. What owners and charterers expect from their brokers today has fundamentally changed in the last few years, but many intermediaries have not yet taken this on board.”
Armitage is pragmatic about the challenges of his mandate. Many brokers have traditionally regarded class societies as only marginally relevant.
“The backdrop has changed dramatically,” he insists. “A whole range of shipping’s stakeholders, not only brokers but also financiers, law firms, charterers and others, need support to stay current with the accelerating pace of regulatory and technology developments.”
Armitage points to a whole range of new technologies at various stages. New fuels, ship ‘readiness’, energy saving devices, air lubrication, wind-assisted propulsion – the list goes on.
Newbuilding brokers need to know which options owners and operators should consider when they prepare to order ships designed and built as ‘future-ready’. Ready for what? Which fuel? Should the bunker tanks and fuel supply system be capable of adaptation? Should foundations be put in place for wind sails?
Armitage believes that many brokers who’ve been around the block a few times are proving slow to realise that the world is changing significantly. “By now, if they’ve been any good, they’ve probably made enough money not to worry too much about tomorrow,” he says. “But demands on brokers are different now.
“I’m talking here about their successors – the next generation of intermediaries who need to be as well-informed and current on regulatory developments and new technologies as possible. We want to be the first port of call for these and other stakeholders.”