Seminar on the Global Shortage of Seafarers

and the Role of the Shipping Industry & CSR

London, 11 May 2010

Successful Cases of CSR Activities

Robert C Beckman
Director, Centre for International Law (CIL)
National University of Singapore

117
Corporate Social Responsibility CSR

y According to the World Business Council for Sustainable

Development, CSR is:
“the continuing commitment by business to behave
ethically and contribute to economic development while
improving the quality of life of the workforce and their
families as well as of the local community and society at
large”
y Employee loyalty is one of the most important results of
CSR – This also helps in recruitment of new staff

118
CSR

CSR is concerned with:

• Environment
• Safety
• Labour (employees)
• Customers
• Investors
• The (wider) community
• Business Ethics

119
CSR Success Story – Ben & Jerry’s

• Ben & Jerry's ice cream became as famous for its approach
to responsible business as for its products.
• Its mission: continued commitment to incorporating
wholesome, natural ingredients and promoting business
practices that respect the Earth and the Environment.
• It also promotes the value of employee development and
positive contributions to local, national, and international
communities.
• The company also seeks to minimize waste and maintain
safe food production standards.

120
 IMO Secretary-General on CSR
• . . today, issues such as environmental sustainability, the fair
treatment of workers and the duty of care businesses have
towards their customers are of increasing concern. . .
Investors and investment fund managers have begun to take
account of CSR policies when making investment decisions
and consumers have become increasingly sensitized to the
CSR performance of the companies from which they purchase
goods and services.
y “shipping . . needs to be able to show that it has. . . .
cultivated a reliable and well-trained labour force, and has
good environmental, health and safety policies built into its
day-to-day operations. Developing and sustaining a safety
culture and an environmental conscience will do much to
enhance its image worldwide”
121
CSR & Seafarers
• Studies show that companies which place an emphasis on
CSR have more committed and loyal employees
• Given the shortage of seafarers problem, it may be wise for
shipping companies and shipping organizations to
emphasize labour or employee issues as an important
component of their CSR
• Shipping companies should consider more actively
promoting ratification of the 2006 Maritime Labour
Convention
• Shipping companies might want to consider implementing
2006 MLC even before it enters into force – this could have
a significant impact on how seafarers view the company

122
CSR Success Story - NYK

y The Japanese shipping company NYK takes a broad view of

CSR which includes programmes to assist its staff and their
families
y NYK has developed a uniform set of educational materials
and curricula to be used by local instructors at training
centers and manning offices around the world
y NYK operates manning offices in many areas across the
globe to recruit highly skilled seafarers
y NYK classes are long-term programs that offer its staff
classroom study in addition to training on vessels
y NYK also holds meetings in local communities with
seafarers and their families
123
CSR Success Story - V.Ships

y V.Ships is the world’s largest supplier of ship management

services to a fleet of over 1000 vessels
y V.Ships has shown a strong commitment to CSR relating to
the health, safety and welfare of its seafarers
y V.Ships has adopted a “Seafarers’ Charter” which it
prominently displays on its web page
y V.Ships declares that: If you are not treated in accordance
with the provisions of this charter you may contact the
following email address and your complaint will be
investigated. Seafarers-Charter@VShips.com

124
CSR Success Story – V.Ships

V.Ships Seafarers’ Charter recognizes:

1. The right to a safe and secure workplace that complies
with safety standards
2. The right to fair terms of employment
3. The right to decent living and working conditions on
board
4. The right to health protection and welfare measures and
other forms of social protection
5. The full implementation of the above rights

125
CSR Success Story - V.Ships

Furthermore, V.Ships confirms its commitment to ensuring

that:
y 1. Employment is offered to seafarers free of charge
y 2. A workplace free of discrimination of any kind is provided
y 3. Wage payments and allotments are paid in a timely
fashion and measures are in place to verify this
y 4. All seafarers receive wages to which they are
contractually entitled
y 5. Every effort is made to relieve seafarers at the time
stipulated in the contract of employment and that measures
are in place to achieve this
126
CSR Success Story - V.Ships

y 6. Recruiting offices provide a welcoming environment and

courteous disposition towards all seastaff
y 7. Shore-based employees treat all seastaff with respect at
all times and that this respect is reciprocated to promote
harmony on board
y 8. There is follow up of any complaint from seafarers
alleging non compliance with this Charter
y 9. There is commitment to improving seafarers lives at sea
and ashore as an ongoing priority

127
CSR to promote Navigational Safety and
Environmental Protection
y Many companies do CSR by raising funds for local
charities, protecting the environment, etc
y It would enhance the image of shipping companies if they
channeled their “community program” efforts into
activities which demonstrate their commitment to
improving navigational safety and protecting the marine
environment
y This would send a message to the local communities that
shipping companies care about navigational safety & the
marine environment
y For example, shipping companies could fund or sponsor
“coastal clean-up” campaigns
128
CSR & Cooperative Mechanism for
Straits of Malacca & Singapore
y In September 2007, after three years of negotiations, a
new cooperative mechanism to enhance safety and
environmental protection was adopted for the Straits of
Malacca and Singapore
y First cooperative arrangement which implements Article
43 of the 1982 UN Convention on the Law of Sea in a
strait used for international navigation
y 3 littoral States and users share responsibility for
enhancing safety and environmental protection in the
straits

129
Importance of the Straits

y Major shipping route between Europe / Middle

East and East Asia
y 50% of the world’s supply of oil
y 30% of the world’s commerce
y 90,000 vessels over 100 gross tons / year
y 23,000 oil tankers / year
y 4,000 LPG/LNG carriers / year

130
Cooperative Mechanism for SOMS

1. Cooperation Forum – to enable user States

and other stakeholders to meet with littoral
States to discuss safety, security and
environmental protection in the Straits
2. Aids to Navigation Fund – voluntary fund to
maintain and replace aids to navigation
3. Projects – specific projects supported by user
States to enhance safety & environmental
protection in the Straits

131
2009 Contributions: Aids to Navigation Fund

y Nippon Foundation - US$ 2.5 million

y Japan Shipowners Association – US$ 0.5 million
y Middle East Navigation Service (MENAS) -US$ 1 m
y Korea - US$ 100,00
y United Arab Emirates - US$ 100,000
y Greece – US$ 1 m (IMO Trust Fund)

132
Features of the Mechanism
1. Scheme is inclusive – intended to include private
companies and NGOs as well as States
2. Scheme gives cooperating stakeholders a voice in the
Cooperation Forum
3. Cooperation is purely voluntary – no attempt to impose
tolls or mandatory charges
4. It does not infringe the sovereignty of the littoral States
and is consistent with UNCLOS
5. IMO played a crucially important role as a facilitator

133
CSR & Cooperative Mechanism

y In March 2007, Mr Yohei Sasakawa, head of The Nippon

Foundation, argued at a seminar of think tanks in Singapore
that shipping companies have “an international social
responsibility” for the safety and environmental protection
of the oceans
y Mr Sasakawa also argued that under CSR, private shipping
companies, as major users and beneficiaries of the Straits,
should bear some of the costs of safe passage through the
Straits of Malacca and Singapore

134
CSR and Cooperation Mechanism

• Mr Sasakawa argued that because they directly benefit from

aids to navigation in the Straits of Malacca and Singapore,
shipping companies should help pay for
• the maintenance, management and replacement of such
aids to navigation
• the costs of installing new navigational aids as well as
the costs of any dredging that was necessary to improve
navigational safety

135
CSR and Cooperation Mechanism

y The participation of private companies such as the Japan

Shipowners Association is a demonstration that they accept
their corporate social responsibility as beneficiaries of the
aids to navigation
y The Roundtable Members were instrumental in obtaining
the support of MENAS
y Roundtable members have also pledged in kind support for
the Cooperation Mechanism
y Nippon Foundation continued its long support for
navigational aids in the Strait by also making a major
contribution to the Aids to Navigation fund

136
Conclusions

• Shipping companies should do more to send a clear

message that they support programmes that are intended
to promote navigational safety and environmental
protection
• Shipping companies should also adopt CSR policies to
demonstrate a genuine concern for the welfare of their
employees, especially seafarers

137
Conclusions

• If shipping companies adopt an effective CSR policy, it will

not only improve the image of the shipping industry, it
will indirectly assist in recruitment and retention of
seafarers
• Studies have shown that employees who are satisfied
with their company’s commitment to social and
environmental responsibility are likely to be more
positive, more engaged and more productive

138
Thanks for Your Attention

Prof Robert Beckman

Director, Centre for International Law (CIL)
National University of Singapore

Email: CILDIR@NUS.EDU.SG

Website: www.cil.nus.edu.sg

139
140