What do the Oscars and the Maritime Industry have in common?
In my mind the Oscars are to do with the celebration of excellence in the film industry; the ultimate recognition of film makers, directors and actors. This morning as I look through my twitter feed it is clear that the Oscars have become much more than that, there is a political message. One example – best actress in a supporting role goes to Viola Davis, she is celebrated not only for being a great actress but for obtaining an award “despite” being black. Politics seems to find a way of intruding into every aspect of our lives these days and Donald Trump has made that much easier. There is a danger that attention is focused on the politics and away from what the highest award in the film industry should be all about – people – who create the context, have the vision as well as the power to make it happen, who excel in their field and continuously raise the standards in the industry.
The same can be said for the Maritime Industry and in particular the Maritime Industry in the UAE. There have been numerous articles about the impact of Trump’s decisions on the development of the Maritime Industry and in particular the Oil & Gas industry. Many are excited by the prospect of Rex Tillerson, ex- ExxonMobil as the United States Secretary of State. Many are perturbed by Trump’s protectionist policies and the impact that will have on trade. As I sit here and wonder what the impact of POTUS’ decisions may be, I also ask myself whether we are focusing sufficiently on the more pressing and immediate issues which arise within our industry. No doubt, Trump’s politics have the power to affect the industry in a variety of ways. Here, on this side of the Atlantic, we may not have control over these politics, but we do have control over the performance and the standards within the industry itself. We may not be able to influence the development of a protectionist agenda but we can certainly influence other immediate threats and opportunities to the maritime industry. We can ensure that attention remains on what matters to our industry and move focus away from political decisions over which we have no control.
In my view one of the issues we should be paying much more attention to is the compliance and regulatory issues, both the general which apply across many industries (for example the UK Bribery Act / anti money laundering regulations / sanctions / cyber security) as well as those more specific to shipping (ballast water management convention / sulphur cap). There are many views as to the rights and wrongs of these regulations as well as the cost impact of these regulations in an industry that is already suffering from low rates.
Whichever side you are on, as we are well into 2017, it is clear that we will continue to see an ever increasing amount of complex compliance requirements. Specifically in the world of shipping, 2016 saw the implementation of the container weighing regulations, 2017 will welcome the ballast water management convention and 2020 is the date for implementation of IMO’s 0.5% cap on sulphur emissions. Indeed in January 2017 we have already seen important amendments to the Maritime Labour Convention, 2006, requiring immediate compliance.
These need to be confronted by companies and attention focused by directors on how to develop, implement and maintain effective compliance programs so to enhance company performance and profitability through risk reduction, reduced claim severity, and lower penalties if violations do occur. There must be recognition that a deficient compliance program is potentially fatal for the business and can result in increased liabilities, harmful management distractions, and negative publicity.
Perhaps the greatest difficulty is that the position with a number of these regulations and rules is sometimes fluid (for example with sanctions regimes) and does not necessarily apply uniformly to all, but it may depend on your company’s area of operation or nationality of employees. So the only safe advice to be given is to remain vigilant and well informed.
The shipping industry may not be as glamorous as the film industry and the Oscars; focusing on compliance rather than politics may not be as exciting, but it may be the only way to keep up the standards in the industry and for each individual business to remain in the game in these uncertain times.