A New Agenda for the Maritime Supply Chain

Sustainability expectations are growing in the shipping industry, and a new agenda is emerging. Dr Henrik Sornn-Friese is working to unify what have been, until now, fragmented attempts to bring best environmental practices to the maritime supply chain.

Sornn-Friese is Director of CBS Maritime, an organization in the Copenhagen Business School focused on maritime research and teaching. His partnership with Dr David Gillen and Dr Jane Lister of the Sauder School of Business at the University of British Columbia, Canada, won a Canadian federal government Social Sciences and Humanities Research Council grant to develop an international research network on green shipping policy solutions.

The aim of the project is to facilitate better awareness and understanding of environmental management challenges and best practices for producers, shippers, shipowners, customers, ports and local communities.

The partnership includes 10 academic partners and eight industry and government partners across Europe, North America and South East Asia. The project commenced late fall 2015, and Sornn-Friese talks about where he hopes to have the greatest impact.

A key element of the project is knowledge transfer between academia and business. What aspects of environmental management will you focus on?

The partnership focuses on three broad themes: corporate governance, port governance and stakeholder governance.

The corporate governance theme examines the nature and implications of the market-based green demands that cargo owners increasingly force upon shipowners and operators, whether in bulk or liner shipping. This will further our understanding of the drivers and benefits of corporate responsibility in shipping.

The port governance theme focuses on the potential for reducing the emissions from ships in ports and the port’s role in such efforts. We aim to identify the main drivers, challenges and advantages of green port governance.

The stakeholder governance theme addresses the challenges in coordinating the communication and knowledge exchange necessary for aligning the green shipping expectations of maritime companies with those of their stakeholders.

We are currently seeking to expand with a fourth theme focusing on green shipping innovation, especially innovations in business administration and organizational forms. The management of innovation (and more so if it is radical, breakthrough, or disruptive innovation) is a very special form of governance that requires capabilities for opportunity recognition, openness to risk seeking and the ability to reduce or control risk and uncertainty.

Where would you most like to see change?

The interface between ships and ports is crucial in reducing emissions from shipping, and hence we would like to see fundamental improvements in that interface. This will rest not only on improved administrative systems and technologies but also on developing new forms of coordination and cooperation among shipowners and operators and the various actors in the port business ecosystem.

The project attracted $200,000 from the Canadian Social Sciences and Humanities Research council. What’s happening with the money?

 We are still in the project launch stage. Research teams have been established at CBS, at Sauder School of Business and at other partner universities in Canada to work on concrete research tasks, and our university partners in Germany, Belgium, France, the United Stated and Singapore are currently defining research tasks and setting up their own teams. Both in Copenhagen and Canada have we started focusing on issues related to sustainability in ports, but we also have started to look into sustainability issues along other nodes in the maritime supply chain.

One CBS Maritime team is collecting and systematizing data on sustainability practices and policies in the top 50 container ports, top 25 dry bulk ports and top 25 liquid bulk ports around the world. We want to see how much shared understanding and vision for the achievement of sustainable ports there is. We are also examining the level of fragmentation in practices and policies and the possibilities and challenges for achieving global governance coherence.

In addition, we are interested in changing the currently strong “green port” focus on hinterland solutions such as, transshipment of goods to final destination via rail instead of road, more towards the seaside of ports. We believe there is big potential in reducing emissions from ships backing up off the ports, waiting to be berthed. We thus see an important challenge of ports and their stakeholders, including shipowners, in reducing vessel turn-around time in ports, benefitting not only the climate and environment but also the business for ship owners.

Another research team in CBS Maritime focuses on how to increase energy efficiency in the daily operation of ships, while yet another is currently defining research tasks with a focus on sustainable ship recycling.

What is happening from an educational perspective?

Knowledge mobilization and involvement of students are important aims of the partnership, and these are very much reflected in the way the partnership functions. We involve students in research teams and we use our findings in teaching. CBS, the Sauder School of Business and the Chinese University of Hong Kong in Shenzhen have established a joint bachelor’s (B.Sc.) study program on “Global Supply Chain and Logistics Management” with cohort exchange of students taking place from September this year.

Research carried out in the partnership will form part of the foundation for teaching in this and other maritime teaching programs.

Another important teaching outlet is the bachelor’s (B.Sc.) program in International Shipping and Trade which is offered by CBS in close collaboration with Singapore Management University and Texas A&M University in Galveston.

Tell us about your business partnerships.

The project has close collaboration with non-academic partners, which at this stage include from Canada: Teekay Shipping, Seaspan Ship Management, Teck, British Columbia Chamber of Shipping, Chamber of Marine Commerce, Transport Canada and Port Metro Vancouver.

It also includes the world’s largest shipping association, The Baltic and International Maritime Council (BIMCO), which is headquartered in Denmark.

Non-academic partners support the project through various forms of research guidance and discussions as well as in facilitating dissemination of our findings.

Does your view of sustainability encompass human rights issues in the maritime supply chain?

A basic tenet of our project is in accordance with the United Nations Sustainable Development Goals; namely that the greening of the maritime supply chain can go hand in hand with growth in international production, consumption and trade, and that sustainability measures should be viewed holistically in that sense.

Our project focuses specifically on the recent accelerating green shipping trends and not on broader social costs and responsibilities – that is, our focus is on the environmental accountability and reduction of the air, land and water impacts of the maritime sector.

There are thus many aspects of the Goals that we do not address or even consider in the project including gender issues, equality, poverty reduction and the educational level in societies. That said, there are certainly targets relating to some of the goals that are relevant in our project – especially targets concerned with integrating climate change measures in policies, strategies and planning. Such are highly relevant in the context of port development and in the international regulation of shipping.

We do not directly address questions about human rights at sea or in the broader maritime supply chain, but there is potential for being more explicit in this regard in the future. For example, successful long-term measures to lower the emissions from ships require upgrading working conditions and raising the level of crew training. Improved working conditions, crew satisfaction, health and safety, and competence levels are key in inhibiting violation of human rights at sea.

What is your ultimate goal for the industry?

We hope that our findings, and the recommendations that we can develop from those findings, will lead to greater governance coherence, better coordination and less uncertainty along the maritime supply chain and hence improving green shipping governance effectiveness.

The first phase of the project will run until the spring of 2017, and it will be scaled up from there.

Source: Human Rights at Sea