Sustainability Agenda

Hafnia – an overview of 2019

The Global Goals for Sustainable Development

Our Approach to Sustainability

Our approach to sustainability starts with the United Nations Sustainable Development Goals (UNSDGs). Much of what we do at Hafnia contributes towards multiple UNSDGs. Hydrocarbons fuel our planes, trains and automobiles. They power our homes and are used to make the roads that connect our cities. From clothes to cleaning products, packaging and pharmaceuticals – our modern world depends on hydrocarbons. Its safe and responsible transportation around the world is therefore essential to maintaining a sustainable quality of life globally.

As a member of BW Group, Hafnia leans on over 80 years of deep maritime expertise and legacy. The Group’s work in oil and gas transportation, floating gas infrastructure, environmental technologies and deep-water production lends Hafnia deep experience, and a track record of dependability. We believe in the importance of playing a role in the sustainable development of maritime energy transportation. We are confident of our ability to contribute positively and act to reduce our impact on the environment for future generations to come.

Sustaining the world with hydrocarbons

Hafnia is taking the lead in the product tanker industry to increase the sustainable and responsible transportation of hydrocarbons to support sustainable growth as outlined by the UN’s Sustainable Development Goals.

Our modern world
depends on hydrocarbons

How We Engage Stakeholders

Regular dialogue with employees, crew, customers, investors, bank partners, industry groups, governments, regulators, suppliers and third-party providers through formal and informal channels is essential to the way we do business at Hafnia. We are open to stakeholder engagements on how we can develop sustainably in collaboration and partnership. The table below summarises the highlights of our stakeholder engagement in 2019.

Summary of Stakeholder Engagement and Outcomes

Stakeholder	Mechanisms for engagement	Stakeholder expectations	Follow-up from Hafnia
Crew	Crew shore conferences Vessel visits Quarterly and monthly HSEQ newsletters Cadet programs Emails Conference calls Induction/ familiarisation	Competitive and timely wages Clear and timely communication Career development Job security Respectful and safe workplace Medical and social benefits Quality of crew Effective appraisals	Introduced anti-harassment and anti-bullying policy Fleetwide implementation of Crew Wellness Program “Wellness@Sea” Introduced new training programs Enhanced recruitment and selection process Started quarterly letters from Executive Vice President, Technical Target to recruit more female crew
Employees	Townhalls Intranet Meetings Formal appraisals Annual Employee Engagement survey Emails	Career development Competitive benefits Support diverse workforce Respectful and safe workplace Work/life balance Reliable and industry-leading technology Better cross-department collaboration Clear and timely communication ESG efforts in company agenda	Implemented CEO Blogs and department videos Committed to inform all crew and employees of press releases Introduced new resources including laptops/ phones, monitors and collaboration tools Participate in Women in Shipping Charter Participate in Getting to Zero Coalition Creation of Sustainability strategy
Customers	Website Industry events Regular meetings Customer appreciation events Member of oil companies’ working groups Emails	Available vessels at competitive rates Well-maintained vessels Compliance with all regulations Good customer service	Prompt and respectful customer service Continued focus on fleet maintenance Engaged PR agency to steer social media engagement initiatives
Pool partners	Twice yearly technical conferences Twice yearly BOD meetings Informal meetings Industry events Monthly statement of accounts Weekly market report	Equitable allocation of pool points Clear and timely communication Good, respectful service Trustworthy response, quick and accurate information Sharing of market intelligence	Prompt and respectful customer service Focus on fleet optimisation Sharing of market intelligence Use of agreed pool point allocation model Transparent communication
Government and policy makers	Regular dialogue Topic specific conferences and events Media coverage Participation in industry coalitions and study groups	Provide safe and reliable maritime energy transportation Offer innovation solutions to decarbonise Invest in local presence	Leveraged Hafnia’s expertise to position itself as a global thought leader on trade, sustainable shipping, innovative solutions and alternative fuels Active participation in major industry events as speakers to share expertise Members of Danish Shipowners Association, Singapore Shipping Association, International Maritime Employers’ Council, Getting to Zero Coalition, ShippingLab
Capital Providers	Roadshows Investor presentations Ongoing Meetings Bank Days Investor Relations functions Media coverage Press releases	Return on investment Transparent and credible reporting Investment in line with Poseidon Principles Strong steps to ensure forward reduction in emissions Compliance with all regulations	Active participation in major industry events as speakers to share expertise Inaugural earnings presentation webcast and telecon Continued regular dialogue and meetings Communicated sustainability initiatives at presentations
Potential talent	Social Media Website Job fairs Speaking engagements Media coverage	Career development Competitive benefits Support diverse workforce Respectful and safe workplace Work/life balance	Active participation in major industry events as speakers to share expertise New website Engagement of PR agency to steer social media engagement

Above: Summary of Stakeholder Engagement and Outcomes

Topics of Materiality and Our Sustainability Approach

Materiality is a critical input into this sustainability report as it ensures we provide our stakeholders with the information most relevant to them and our business. Material topics are those that can reasonably be considered important to reflect Hafnia’s Environmental, Social and Governance (ESG) impacts, or influencing the decisions of stakeholders. Materiality can also be determined by international standards and agreements, broader societal expectations, and by our influence on upstream entities, such as suppliers, or downstream entities, such as customers and shipyards. A list of 16 material topics was consolidated through formal and informal discussions with multiple stakeholders, and forms the foundation of our sustainability approach.

Our commitments	Goal 7: Affordable and Clean Energy Goal 12: Responsible Consumption and Production Goal 13: Climate Action
Our priority projects	Goal 5: Gender Equality Goal 7: Affordable and Clean Energy Goal 9: Industry Innovation and Infrastructure Goal 12: Responsible Consumption and Production Goal 13: Climate Action
Our fundamentals	Goal 3: Good Health and Wellbeing Goal 5: Gender Equality Goal 8: Decent Work and Economic Growth Goal 7: affordable and Clean Energy Goal 9: Industry Innovation and Infrastructure Goal 12: Responsible Consumption and Production Goal 13: Climate Action Goal 14: Life Below Water Goal 15: Life on Land Goal 16: Peace Justice and Strong Institutions

Above: Hafnia’s contributions towards the United Nation’s Sustainable Development Goals

Above: Hafnia’s Sustainability Strategy

At the top of our sustainability agenda lies our commitment as a company to sustainable development – the provision of safe and reliable hydrocarbon transportation solutions for our customers. Our business is at the heart of global trade, and we focus on delivering energy to world markets, even as we look to the future and explore what it means to pursue sustainable development as a shipping company.

In 2019, we made it our priority to actively participate in the decarbonisation of shipping, and to improve workforce diversity at Hafnia. These two topics will be the subject of special focus in this chapter. Our material topics touch directly or indirectly on many of the UNSDGs and Table 2 shows our efforts in this regard.

Above: Singapore flagged BW Galatea, one of Hafnia’s newbuilds delivered in 2019 and built with energy-saving equipment such as rudder bulb, and mass flow meters (MSM) in its fuel lines

Material issue	Zero Harm	Security at Sea	Spills to Sea	Emissions to Air
Importance	Fundamentals/ Strategic/ Safety of Life	Fundamentals/ Strategic/ Safety of Life	Fundamentals/ Strategic/ Environment	Fundamentals/ Strategic/ Environment
UNSDG
Targets met?
Goal	To achieve Zero Harm to People, Environment & Property with a commitment to return safely to our families and friends	To protect our crew and assets from risks in troubled times and waters	To protect our oceans and seas from pollution arising from our operations	To reduce our environmental impact and comply with all global emissions regulations
2019 targets	0 fatalities 0 Lost Work Case Injury Continuous improvements in all safety related areas Ingrain all Zero Harm initiatives into Hafnia’s work culture	0 fatalities due to security incidents 0 casualties due to security incidents 0 days lost due to security incidents	0 spills to sea 100% compliance with IMO Ballast Water Management Convention 100% compliance with MARPOL Annex I (oil), II (noxious liquid substances), and IV (sewage) regulations 100% compliance with internal waste management policies	Full compliance with IMO2020 emissions regulation to burn fuels with sulphur content below 0.5% Continuously improve vessels’ energy efficiency
2019 progress	0 fatalities 5 Lost Work Case Injuries¹ Completed Safety Culture Survey to assess strengths and weaknesses in fleet culture Established Visible Leadership program	0 fatalities due to security incidents 0 casualties due to security incidents 0 days lost due to security incidents	0 spills to sea 100% compliance with IMO Ballast Water Management Convention 100% compliance with MARPOL Annex I (oil), II (noxious liquid substances), and IV (sewage) regulations 100% compliance with internal waste management policies	Installed 3 scrubbers Announced participation in Getting to Zero Coalition Successfully transitioned all vessels to low sulfur fuel options Leveraged on computerised performance system to manage fleet performance
2020 targets	0 fatalities 0 Lost Work Case Injury Launch Visible Leadership program and senior management ship visits Arrange 2 drills to improve sea/shore communications	0 fatalities due to security incidents 0 casualties due to security incidents 0 days lost due to security incidents 1 drill involving piracy scenario 1 drill with piracy scenario	0 spills to sea 100% compliance with IMO Ballast Water Management Convention 100% compliance with MARPOL Annex I (oil), II (noxious liquid substances), and IV (sewage) regulations Introduce environmentally-friendly detergents on Hafnia fleet non-compliance with internal waste management policies	Actively participate in Getting to Zero Coalition Introduce initiatives to reduce emissions from shore 25 dry dockings to optimise vessel performance Continuously improve vessels’ energy efficiency

¹We regret to report 5 Lost Work Case Injuries in 2019. Full investigations and Root Cause analyses were done for all cases, and learnings were shared fleetwide. These 5 cases did not involve loss of body parts.

Material issue	Ship Recycling	Plastic Waste & Garbage Disposal	Regulatory Compliance	Freedom to Trade
Importance	Fundamentals/ Strategic/ Environment	Fundamentals/ Strategic/ Environment	Fundamentals/ Strategic/ Governance	Fundamentals/ Strategic/ Governance
UNSDG
Targets met?
Goal	To ensure that all ship recycling is conducted in compliance with the Hong Kong Convention	To ensure clean seas and reduce plastic waste¹ on board and ensure compliance with international sewage regulations	To ensure full compliance with relevant international maritime regulations governing shipping and energy transportation including EU MRV and IMO DCS Reporting	To observe political developments carefully, influence government and regulatory bodies actions where possible and comply with sanctions
2019 targets	Commit to comply with the Hong Kong Convention for all ship recycling initiatives 100% compliance with Hong Kong Convention	0 non-compliance with MARPOL Annex V (garbage) regulation Reduce plastic waste by 2% below 2018 level (19.11 m3/vessel)	0 non-compliance with relevant international maritime regulations governing shipping and energy transportation	0 non-compliance with relevant international sanctions regarding maritime trade
2019 progress	Ship Recycling Policy published on website Completed HK-IMH Certification of all managed vessels	0 non-compliance with MARPOL Annex V (garbage) regulation Plastic waste was 8.8% less than 2018 levels at 17.8 m3/vessel	0 non-compliance with relevant international maritime regulations governing shipping and energy transportation	0 non-compliance with relevant international sanctions regarding maritime trade
2020 targets	0 non-compliance with Hong Kong Convention	0 non-compliance with MARPOL Annex V (garbage) regulation Reduce plastic waste by 2% below 2019 level	0 non-compliance with relevant international maritime regulations governing shipping and energy transportation	0 non-compliance with international sanctions regarding maritime trade

¹ Plastic means a solid material which contains as an essential ingredient one or more high molecular polymers and which is formed during either manufacture of the polymer or the fabrication into a finished product by heat and/or pressure. For the purposes of MARPOL Annex V, “all plastics” means all garbage that consists of or includes plastic in any form, including synthetic ropes, synthetic fishing nets, plastic garbage bags, containers, electrical and electronic components, utensils, and incinerator ashes from plastic products.

Material issue	Anti-corruption and anti-bribery	Culture & Values	Workforce Diversity	Talent Development and Retention
Importance	Fundamentals/ Strategic/ Governance	Fundamentals/ Operational/ Right People	Fundamentals/ Operational/ Right People	Fundamentals/ Operational/ Right People
UNSDG
Targets met?
Goal	To stand united and eliminate corruption and bribery faced by the maritime industry	To make Hafnia one of the best places to work, where we treat each other with respect and work together to deliver the industry of tomorrow	To create an inclusive work environment and culture where differences are celebrated and cross-cultural best practices are developed	To find and develop people that will thrive within the Hafnia culture and have qualities that can push the business to greater heights
2019 targets	0 facilitation payments for Hafnia fleet Comply with legislation on anti-corrupt practices	Launch new Culture & Values Roll out Culture & Values in offices worldwide	Increase representation of women in senior leadership positions Increase female crew representation to at least 30 by 2025	Continue promoting from within Offer training and talent development opportunities Identify high potentials early to accelerate development ≤10% attrition rate on shore and at sea
2019 progress	0 facilitation payments for Hafnia fleet Rolled out posters and crew communication with tagline “Do Not Ask, We Will Not Pay” Continued membership in Maritime Anti-Corruption Network (MACN) Global communication to commemorate UN Anti-Corruption Day	Culture & Values launched on time and rolled out globally by senior leaders of Hafnia Workshops were conducted for all shore employees Created new department called “People, Culture and Strategy” Continued to run ship training programs Culture & Values launched on Hafnia managed vessels	Continued with efforts to build inclusive leadership and engage our employees on the I&D agenda Appointed one female Board Member 3 female officers currently in employment Continued to run cadet programs	28 staff promoted, 3 temporary staff moved into full-time positions, 1 staff member offered overseas posting 8.6% attrition rate on shore 45% of sea staff vacancies filled through internal promotions 97% retention rate for sea staff
2020 targets	0 facilitation payments for Hafnia fleet Comply with legislation on anti-corrupt practices Continue membership in MACN Global communication to commemorate UN Anti-Corruption Day	Continue reinforcement of new Culture & Values All new hires to attend a Culture & Values workshop within their first year with company All new shore hires to attend a Culture & Values workshop within their first year with company All new sea hires to attend Culture & Values training on board	Active member of “Women in Shipping Charter” to encourage women to join shipping Continue to recruit female officers to meet 2025 target Continue to run cadet programs	Continue promoting from within Conduct ≥3 employee engagement events ≤10% attrition rate on shore and at sea Offer training and talent development opportunities Identify high potentials early to accelerate development Launch Competency Management System Continue welfare initiatives such as short crew contracts and medical insurance during leave

Material issue	Crew Wellness	Customer Relations	Innovation	Asset Management
Importance	Fundamentals/ Operational/ Right People	Fundamentals/ Operational/ Right People	Fundamentals/ Operational/ Right Resources	Fundamentals/ Operational/ Right Resources
UNSDG
Targets met?
Goal	To continuously improve the physical and mental health of our Seafarers	To build trust with customers that we can be relied upon for fast and accurate response to all queries	To encourage a culture of innovation and creativity at Hafnia; and in partnership with peers and start-ups, explore new solutions and offerings in the maritime energy sector	To ensure optimal availability of vessels for our customers
2019 targets	Fleet-wide implementation of Wellness@Sea Program Establish emotional helplines for all Seafarers Educate Seafarers on mental health	Continued fast and accurate responses to customer queries 0 negative external feedback on poor customer service 1 customer appreciation event 2 Pool Board meetings 2 Pool Technical meetings	Foster innovation at Hafnia by encouraging independence of thought regardless of job title and delegating responsibility Identify inefficiencies and harness quick-wins from available digital resources	0 delay in planned dry dockings ≤2 days unplanned off-hire 0 Port State Control detention ≤4 SIRE inspection observations per vessel0 delay in planned maintenance onboard vessels 0 delay in planned maintenance on board vessels
2019 progress	Fleet-wide implementation of Wellness@Sea Program 3 emotional helplines available Training on mental health for senior officers started in Indian office	0 negative external feedback on poor customer service 1 customer appreciation event in Geneva 2 Pool Board meetings 2 Pool Technical meetings	Hired 1 headcount to focus on fostering innovation within the organisation Identified inefficiencies in operations handover and launched digital solution which reduced handover time by 15%	5 dry dockings as scheduled for in-house managed vessels 2.38 days unplanned off-hire¹ 0 Port State detention Average of 2.7 SIRE inspection observations per vessel
2020 targets	All vessels to complete 52-week workbook / activities Mental health training for Philippines office Collect and analyse data from use of emotional helplines Education through Mental Health exercises	Continued fast and accurate responses to customer queries 0 negative external feedback on poor customer service 1 customer appreciation event 2 Pool Board meetings 2 Pool Technical meetings	Appoint 10 innovation agents to champion change internally Kick-start 1 pilot project with industry peers and/or start-ups focused on decarbonisation	0 delay in planned dry dockings ≤2 days unplanned off-hire 0 Port State detention ≤4 SIRE inspection observations per vessel 0 delay in planned maintenance onboard vessel

¹ Upgrade of elderly tonnage added to off-hire days.

Sustainability Agenda

Hafnia – an overview of 2019

The Global Goals for Sustainable Development

Our Approach to Sustainability

Sustaining the world with hydrocarbons

How We Engage Stakeholders

Summary of Stakeholder Engagement and Outcomes

Topics of Materiality and Our Sustainability Approach

Our commitments

Our priority projects

Our fundamentals

Our Focus and our Initiatives

Governance

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