An interview with Carnival and Grieg Star:
The MACN is currently collaborating with the United Nations Development Programme (UNDP) to conduct a corruption risk assessment of four ports in Nigeria. This is a pilot project which began in 2012 and will conclude in August 2013, with recommendations to be made on how to reduce the risks faced at these ports. MACN is co-financing the project and is working with Nigeria’s anti-corruption unit, The Technical Unit on Governance and Anti-Corruption Reforms (TUGAR), on executing the assessment, with the support of the Nigerian Ports Authority.
The Red Flag Group had the exciting opportunity of interviewing Travis Winslow, Director of Ethics and Corporate Compliance at Carnival Corporation & plc, and Marit Trodal, Corporate Responsibility Manager of Grieg Star, who were able to share details about MACN’s project. During the interview, both Travis and Marit revealed some of the challenges faced in undertaking the risk assessment, including breaking tradition and encouraging anti-corruption practices by port workers. It is hoped that the findings of the assessment can be utilised if further countries are targeted for corruption risk assessments in the future.
Can you tell us about MACN’s direct role with regards to the pilot project initiative with the UNDP in Nigeria?
Marit: The MACN is co-financing this project and is working with local body TUGAR (The Technical Unit on Governance and Anti-Corruption Reform) who will be the body executing this project on the ground. This teamwork with the authorities is a unique relationship, where we are providing the UNDP and TUGAR with our input and perspective on the risks that arise at the ports in Nigeria.
Travis: One of the goals of the MACN is to work with government bodies to increase the trust with public private partnerships in general. With this project, our MACN members collated a list of “hotspots” where we have seen and/or experienced issues. We then narrowed this list down to ten hotspots which we would be most interested in assessing, and then shared the list with the UNDP. The UNDP made recommendations to us about the countries where they believed the study would be most successful. Because of the role we played identifying the interest areas, we were also able to have the opportunity to co-finance the assessment.
What impact do you think the involvement of a body such as the UNDP has made on this project?
Travis: Whenever there is a government body involved there is increased legitimacy and credibility in an initiative which, if solely managed by a private company, would be viewed as profit driven. Having the UNDP in the project helps to build a sense of trust.
Can you explain why Nigeria was chosen from the list that MACN collated to be the first hotspot for the project?
Travis: Although Carnival Corporation itself does not conduct business in Nigeria, our MACN members had made some comments regarding issues such as facilitation payments to port officials. The list that was shared with the UNDP was not ranked by us, although the UNDP did recommend the hotspots with the most likelihood of success. Together we determined Nigeria to the best country to start with.
Marit: Although Grieg Star does not have business in Nigeria either, a major motivation for beginning our project there was to tackle the corruption that is an obstacle to Nigeria attracting more foreign direct investment (Nigeria has a vision of becoming one of the world’s twenty largest economies by 2020). Moreover, we recognise that there are a lot of people in Nigeria who find the ports attractive to work in as they know it to be a great way to supplement their main salary through illegitimate means.
In terms of expertise, do you have, for example, a local body that has experience in projects such as this risk assessment? Are they helped by the UNDP and the MACN?
Marit: Yes, all those taking part in the project, including TUGAR, are trained risk assessors who will work in the four different ports in Nigeria during the project. TUGAR has previously conducted risk assessments in other sectors.
What was the methodology chosen to conduct the review on the ports?
Marit: Our aim is to identify the processes in the system which are most weak and of the highest risk. To do this we conduct interviews with a number of people at the ports.
Are you able to share any obstacles faced so far whilst undertaking the assessment at the Nigerian ports?
Marit: Shipping companies have to follow a specific timeslot when they are unloading cargo at a dock, and if the process takes longer than this specified timeslot a fine is levied against them. However, this process is manipulative and chaotic, with no transparency. The fines are arbitrary and ill-defined, which gives port officials opportunities to leverage their position and suggest to employees of the shipping companies advantages which could be given to them in order to avoid fines and bypass other problems whilst unloading. The process is cash-based and this, coupled with the fact that there are so many agencies involved, makes the process impossible for shipping companies to manage. Overall, when arbitrary decisions are involved, there is the temptation to make additional demands.
Which challenges are preventing on-the-ground workers from fighting corruption, and what are the incentives which could be given to these workers to cooperate with anti-corruption initiatives?
Travis: Tradition is a major obstacle. Workers believe that facilitation payments and other advantages are received as a right; it is difficult to break this tradition as it is also a cultural thing. In a conference that we attended, some of the participants opined anti-corruption initiatives as being a “western notion”, so this is not an understanding that exists naturally.
Marit: There are also those workers who recognise corruption should be stopped but find it difficult to do so because it is accepted and controlled by their seniors.
Has the MACN and the UNDP discussed how to conduct the assessment to ensure that there will be no retaliation and that it will not motivate investigations against the interviewees?
Marit: We explained to the interviewees that it will increase efficiency in their procedures, and that it will attract foreign investments. Ports will become much more effective in their procedures without corruption and with more transparency. We definitely do not want to sound threatening during our risk assessment either. Another incentive is that any recommendations which are acted upon will be funded by us – that is the second phase of this project.
After Nigeria, do you foresee pilot projects occurring in other hotspots, based on the UNDP’s recommendations?
Travis: We hope this to be the case, and are waiting to see the results and success of our work in Nigeria to prove that it works and to share this assessment in other countries.
Do you anticipate more companies joining the MACN? What do you feel are the incentives for companies to become members?
Travis: One thing to note is that joining the MACN does not mean collusion; this has never been the case with our members. It is more about coming together to address the issues and become consistent in our anti-corruption approach in various countries, even if it is not one where a particular member company has operations. We want the commitment to be existent in the maritime industry overall, and for there to be consistency in our attitudes, so that when a port official demands an out of scope payment all companies will act against that.
Do you have any parting words for companies that are cooperating or that want to cooperate with government bodies on anti-corruption initiatives?
Travis: There is no time like the present. When you open a door to corrupt payments (whether large or small), it will be difficult to close that door again.
The Red Flag Group thanks Travis Winslow and Marit Trodal for sharing their insights.
Travis Winslow is Director of Ethics and Corporate Compliance at Carnival Corporation & plc.
Marit Trodal is Corporate Responsibility Manager at Grieg Star.