Seminar on CSR activities for the shipping industry

Chairman Mr. Sasakawa, BIMCO President Mr. Khatau and JITI President Mr. Washizu, Ladies and gentlemen,

It is indeed a great pleasure to be here this afternoon and I am delighted to have the opportunity to participate in a seminar on a subject that is very close to my heart – Corporate Social Responsibility.

 

But before I begin, I should just like to say a few words of appreciation about our hosts today – the Japan International Transport Institute (JITI), BIMCO and the Nippon Foundation. All three have done a great deal to promote dialogue and understanding among their members and beyond. I believe that it is only through such processes that, as a community, we can step out of the daily management of our work and our businesses and, instead, raise our eyes to the horizon.

 

Ever since its establishment in 1991 as an independent foundation under the auspices of the Japanese Ministry of Transport, JITI has been engaged in the comprehensive research and survey of transport related issues.  It also works to increase understanding and facilitate collaboration among all interested parties in the transport field, as well as evaluating and offering recommendations on transport policy issues.

 

BIMCO is the largest of the international shipping associations, representing shipowners controlling around 65 per cent of the world’s tonnage and with members in more than 120 countries drawn from a broad range of stakeholders with a vested interest in the shipping industry, including managers, brokers and agents. BIMCO is accredited as a non-governmental organization (NGO) with all relevant United Nations organs, including IMO, and maintains a close dialogue with Governments and diplomatic representations around the world including maritime administrations, regulatory institutions and other stakeholders.

 

The Nippon Foundation was established in 1962 as a non-profit philanthropic organization, active in Japan and around the world. Initially its efforts focused largely on the maritime and shipping fields, but since then the range of its activities has expanded to education, social welfare, public health and other fields. Together with its partner organizations in Japan and worldwide, it is funding and assisting community-led efforts aimed at realizing a more peaceful and prosperous global society.

 

It is, therefore, no surprise that these three esteemed organizations have come together and combined efforts to organize a seminar on Corporate Social Responsibility – a concept that is rooted in philanthropy – in the idea that businesses should work for a greater good than simply financial profit.

 

For me, Corporate Social Responsibility is about operating in such a way that the outcome of one’s efforts is a positive benefit to society overall. It is about managing one’s core processes with this objective constantly in mind, and that means “building structures and creating mechanisms that are different from old business models”. The concept of the “triple bottom line” – Profit, People and Planet – is often talked about in this context.  What is important is the interconnection between those three things. In today’s world, achieving success in just one of these areas only is simply not enough.

 

Modern expectations are different. Old-school philanthropy was about making money and then donating a proportion of the profit to charitable causes. But today’s concept of Corporate Social Responsibility is concerned with the overall impact a company or organization would make.  In in shipping terms, that embraces everything from how much carbon is emitted in a ship’s exhaust gas, to where the paper for the photocopiers in head office is sourced.

 

As a society, we need to understand that the concept of “wealth” now has a new meaning; a meaning that embraces so much more than "the annual produce of the land and labour” – which is how Adam Smith described it in his work “The Wealth of Nations”. If we do so, then social responsibility becomes an integral part of the wealth-creation process, something that I believe is vital if we are to move towards a viable and sustainable future for all.

 

And this year, 2012, is destined to be remembered for a crucial waypoint on the route to a sustainable and responsible future. I refer, of course, to the UN Conference on Sustainable Development, Rio +20, which will take place in Rio de Janeiro in June. That event will be of vital importance to everybody, including IMO and the shipping industry. Whether we set the correct course beyond that waypoint, of course, remains to be seen.

 

Among the many key topics to be discussed at Rio +20 are the green economy and the institutional framework for sustainable development. And, just as the original Earth Summit in Rio led to valuable and effective work by IMO in support of the so-called Agenda 21 that emerged from that meeting, we are now supporting the Rio +20 process and creating our own way forward for shipping in the context of sustainable development.

 

Through its regulatory and technical co-operation work, IMO will play a critical role in promoting environmentally sound and sustainable shipping. IMO, in my view, provides the ideal institutional framework for sustainable maritime development. Such issues can, and should, be addressed at IMO and, at Rio +20, we will take the opportunity to clearly state the importance of shipping to sustainable development.

 

Shipping is the global carrier of world trade – trade that underpins economic activity. The sustainable development and growth of the world's economy will not be possible without similar sustainable growth in shipping and, therefore, in the entire maritime sector. And, despite the current global economic problems, growth in the longer term seems inevitable. A global population that has passed 7 billion people, and is still rising, with increased buying power, should ensure that is the case.

 

The development of a sustainable maritime transportation sector within the overall global supply chain is essential.

 

But achieving it is by no means straightforward and there are several challenges that need to be overcome. Among these I would include:

 

• overregulation and, in particular, the prospect of regional or unilateral regulatory measures for ships;
• threats to maritime security;
• piracy and armed robbery;
• a shortage of competent seafarers, particularly officers, to operate the increasingly sophisticated vessels; high-quality engineering officers will be particularly in demand as tighter emission regulations require ships to burn lighter fuels in sophisticated new engine designs;
• lack of or insufficient maritime infrastructure such as ports and terminals, intermodal connections, vessel traffic management systems, maritime zone monitoring and control mechanisms;
• the continuing threat of pollution; and
• a lack of cohesive and connected maritime transportation policies.

 

There are, of course, equally important opportunities that offer tremendous scope for optimism and enthusiasm. To achieve sustainable development in shipping, it is important to establish a coordinated and integrated approach to maritime policy and programmes. Energy efficiency, new technology and innovation on maritime security, maritime education and training, maritime traffic management and the development of maritime infrastructure are key elements to sustainable shipping, but these must be underpinned by global standards.

 

Under such a concept, Governments, the shipping and maritime industries and the world community at large should work together to take necessary actions  to ensure that shipping can continue to be environment-friendly, properly supported and protected from security and other risks, including piracy, as well as to make requisite investments for the development of the maritime transportation system.

 

Speaking to you here in Singapore, we cannot help but be aware that about a third of global trade and half of the world's oil is transported through the Straits of Malacca and Singapore, one of the world's busiest sea lanes. Congestion and accidents in the Straits can cause major delays, with significant negative repercussions to the whole supply chain in addition, of course, to the coastal and marine environment of the three littoral states.

 

Which means, of course, that the littoral States, user States, international and industry organizations are all stakeholders in the Straits and share a common interest in ensuring that the Straits remain safe, open and secure for shipping.

 

Indeed, it was, in the first instance, concerns over security that led to one of the first examples of such a collaborative approach to maritime and coastal resource management, here in this very region. In the early 2000s, the piracy and armed robbery situation in this part of the world prompted IMO’s Protection of Vital Shipping Lanes initiative. This, in turn, led to the launch of the Co-operative Mechanism on the Safety of Navigation and Environmental Protection in the Straits of Malacca and Singapore, in September 2007. Since then, the littoral States, user States and the international shipping community have made significant strides, on matters such as navigational safety and environmental protection in this critical trade route.

 

The Co-operative Mechanism provides the forum that allows these stakeholders to exchange views, jointly undertake projects or even make direct monetary contributions to the Aids to Navigation Fund. Projects undertaken to date include the removal of wrecks in the Straits, co operation in capacity building to deal with accidents involving hazardous and noxious substances, and replacing aids to navigation along the Sumatran coastal areas, which were destroyed as a result of the 2004 tsunami. At present, the three littoral States, together with the shipping industry, are carrying out two major initiatives: a review and enhancement of measures implemented in the Straits, as well as a directory of port reception facilities in the Straits.

 

All of these activities are related in some way to the Marine Electronic Highway (MEH) Demonstration Project, a far-reaching concept that uses advanced information technology and enhanced internet connectivity to cohesively allow the management of navigation, environmental protection and emergency response in the Straits in an integrated system.  The project will wind down by June 2012 and, to ensure that the infrastructures established under the project are to be sustained and developed into a full-scale MEH System for the Straits, it must be integrated into an existing regional body such as the Co-operative Mechanism.

 

The Co-operative Mechanism provides a transparent, open and inclusive arena for dialogue among all interested stakeholders, and serves as an excellent example of what is achievable when the interests of all stakeholders are taken into account and collaborative efforts undertaken to achieve common goals. Looking forward, it will be vital to sustain the momentum of the MEH.  I would encourage policy makers to seriously consider establishing a joint venture of littoral States authorities in the public sector and the shipping industry in the private sector for sustainable operation of the MEH in the Straits of Singapore and Malacca.  The Co-operative Mechanism may well provide the solution.

 

Ladies and gentlemen, to return to the main theme of this seminar, just as the Co-operative Mechanism embraces social, economic and environmental dimensions, so too, does the concept of sustainable development. Indeed, these are collectively known as the “three pillars” of sustainable development, which will be discussed in depth at the UN “Rio +20” Conference in June this year. This afternoon, as you discuss corporate social responsibility in the maritime context, I trust that the importance of each of those three dimensions of sustainable development will never be far from your thoughts – because I believe CSR has a positive role to play in all of them.

 

Thank you.
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