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Sustainability

Being your trusted business partner

Being your trusted business partner is about WWL’s efficient operations and how the company conducts business. Being a trusted business partner is important not only to suppliers and customers, but also in relation to partners such as industry peers. Ethical business conduct is the foundation of all WWL’s operations and activities, while operational efficiency, and the company’s ability to deliver as agreed, is key to creating value for the client.

WWL is committed to fair competition, anti-corruption and anti-bribery through the entire value chain. The company’s Code of Conduct is applicable to all employees and outlines the top management’s commitment and expectations of sustainable, compliant and responsible business conduct.

Ethical business conduct

That all business should be transacted in an ethical manner is a fundamental requirement in WWL. It applies to all of the company’s activities, everywhere and all the time. The company and its board ensure that this requirement is fulfilled directly; all employees have a responsibility in this regard. Ultimate responsibility for ethical business conduct rests with board and the CEO.

WWL see ethical business conduct as a basic ticket to trade. The various stakeholders of WWL, including its investors, customers and employees, take a similar view.

The WWL compliance program

The company conducts a variety of activities ensuring compliance with applicable laws and regulations through its well-established compliance program. The main components of the compliance programme are: to ensure top level commitment; to have in place adequate policies and instructions; to communicate polices and instructions to the organisation by way of training and e-learning; to carry out risk assessments and proactively monitor the organisation’s activities; and to background-check partners. The company is an active member of the Maritime Anti-Corruption Network, where it takes part in actions to improve industry compliance standards. The compliance program is run by the company’s Legal & Compliance department.

Evaluation of results

Through its compliance programme the company stores information about who has received training, keeps track records of findings and makes sure to have adequate statistics, which are reported to the company’s management and board. Furthermore, risk assessment is carried out on a rolling basis and reported to management and board.

Ambitions and next steps

The company keeps its compliance work in sharp focus and has a clear ambition to constantly improve in this regard. In 2018 the company will undergo a third-party health check of its compliance program to ensure that it is as good as it can be. If gaps are located the ambition will be to change and improve.

Quality of service

The interrelation between Environmental, Social and Corporate governance (ESG) issues on the one hand, and quality of service on the other, is the focus of this material topic. The scope of the issue extends to all the services provided by WWL group and is particularly relevant for its operations and commercial divisions. The focus for this report is on two areas: uptime of the owned fleet and compliance with environmental regulation. The former applies to ocean operations only, while the latter applies to all operations on land and at sea. The company always has a direct supervisory role in ensuring quality of its service, however the actual performance of the service is not necessarily done by direct employees of the company.

In the fiercely competitive markets in which WWL operates, quality of service is a key commercial differentiator and the cornerstone for customer growth and retention. Best practice in ESG is equated with supply chain risk mitigation, efficiency, and is increasingly demanded by customers to drive their own ESG agendas.

Quality Management

The uptime of the owned fleet is primarily built on trust and effective communication between ship and shore, such that requests for additional time in port to undertake necessary repairs, refurbishment or maintenance are granted. The metric for uptime of the fleet is its opposite: unscheduled off-hire. Data on this is reported to the Marine Operations Management team monthly and followed up as required. Good risk management is essential in maintaining fleet uptime, which in practical terms has meant applying preventative maintenance techniques to critical equipment.

Regarding environmental regulation, the commitment for ocean and landbased businesses is the same: full compliance with all applicable regulation. Compliance is maintained through regular audits and strict adherence to company procedures and processes.

The aim is for environmental management plans for all facilities to comply with ISO14001. Many facilities already have ISO14001 certification and most of the company’s Ship Managers are ISO14001 certified.

Evaluation of results

Average unplanned off-hire across the entire owned fleet in 2017 was 16.0 hrs, which is an improvement on the calculated figure for 2016 of 21.0 hrs. The improvement was due to improved quality of vessel maintenance routines and performance driven by a focus on planned maintenance by WWL’s newly established Marine Operations Management team. As a new company a 2017 target for unscheduled off-hire was not set.

During 2017 there was one case of environmental regulation non-compliance from ocean operations. It regarded an oil spill in Zeebrugge of over 20 litres, which is generally regarded as the threshold of ‘significance’ in the industry. No sanction was levied by the local authorities. The standard oil spill response procedures were effectuated to minimise the impact of the spill. The total quantity of the oil spill was estimated to be 40-50 litres and it occurred while discharging oil sludge from the vessel to a receiving barge. The reason for the spill was due to miscommunication over whether a flanged connection was ready for transfer to commence. The details of the case have been shared with relevant stakeholders.

Ambitions and next steps

The target for unscheduled off-hire for 2018 is for each individual ship manager to achieve a result of under 24 hours. To reinforce recent advances and further improve unplanned off-hire time, the company will attempt to switch the emphasis from preventative to predictive maintenance during 2018. This will be done by means of trialling specialist sensor equipment for monitoring vital systems and equipment on-board. As this is state-of-the art technology in shipping, it is premature to set any target for the initiative yet.

On the environmental compliance, the previous year’s results demonstrate that existing processes and measures are having the desired effect, so will be continued. For ocean operations an environmental programme has been drawn up and put into effect for the owned fleet which will help keep compliance foremost in the minds of those on the front lines. A corresponding programme is under development for WW Solutions. Finally, during 2018 WWL will seek ISO14001 certification for its corporate environmental management system.

ESG customer management

WWL’s customers make regular enquiries and demands in relation to the company’s Environmental, Social and Governance (ESG) performance and practices. It is also in the group’s interest to determine certain ESG aspects in relation to its business with customers.

Ensuring that services provided to customers always comply with international sanctions, laws and regulations goes with the right to trade in certain countries and is therefore essential to the company’s global operations. As WWl’s services form a vital part of the supply chains of its customers, compliance with the rules and conditions of international sanctions is paramount for them too.

ESG policy and responsibilities

WWL’s policy is to comply fully with the rules associated with international sanctions laws and regulations. The group’s commercial teams are responsible for engaging the support of legal expertise on any case where a concern exists about possible sanction compliance. Conversely, the company’s compliance experts keep the commercial teams updated on development in relation to international sanctions and have implemented a clear sanctions policy. If a case of non-compliance occurs the compliance experts will make sure that the activity is stopped.

Evaluation of results

In 2017 there were no cases in which the group’s companies were found in breach of international sanction laws and regulations, which was an acceptable result. In the past year the company has implemented a clear aligned group sanctions policy.

Ambitions and next steps

The company has an ambition to constantly improve and make sure that all employees and other stakeholders are aware of the implemented sanction policy and intend to roll out an information package, including training and e-learning, in 2018.

Tax Practices

Interest in multinational corporation’s global tax planning has increased over recent years. The Organisation for Economic Cooperation and Development (OECD), an intergovernmental group, has worked out 15 actions relating to global tax planning strategies by multinationals in the so called Base Erosion and Profit Shifting (BEPS) project. The group is committed to be a responsible taxpayer, combining professionally executed tax compliance with legitimate tax planning based on valid business purposes. At WWL, corporate tax affairs fall within the responsibilities of the CFO and extend to all jurisdictions where the company operates.

The correct handling of the group’s tax affairs is of foremost importance to the group, both from a compliance and an ethical perspective. For the tax authorities of the countries in which WWL operates, payable income tax is an important source of government revenue.

Management in line with OECD guidelines

The company is committed to full compliance with OECD guidelines regarding Transfer Pricing documentation rules, which involves having a Master file, Local file and Country by Country Reporting (CbCR) updated annually for each country in which it operates.

Internal resources in Head Office in Oslo as well as local resources and external advisors are involved in the preparation of the Transfer Pricing documentation. After the documentation is submitted, the Norwegian tax authorities or other local tax authorities can follow up with requests for clarifications.

Evaluation of results

WWL submitted Transfer Pricing documentation, including Country by Country Reporting for all countries in which it operates, in a timely manner for 2017, thereby achieving full compliance with the regulation.

Ambitions and next steps

As activity relating to tax practices is driven by regulation, the primary focus of the company is to continue to maintain full compliance.

Security at landbased facilities

WWL has operations at landbased facilities across the globe. Facilities include ocean terminals, distribution centres and vehicles processing centres. All landbased facilities fall within the scope of WW Solutions. Accordingly, the overall responsibility for security on landbased facilities rests with the President of WW Solutions. On an individual facility level, security is among the direct responsibilities of the respective facility managers.

Landbased facility security is materially significant to WWL for a variety of reasons ranging from its close connection to safety to its role in providing industry-leading quality of service. For its customers, a high focus on security protects and contributes to the integrity and efficiency of their outbound supply chains as well as their own product quality.

Zero-tolerance policy

The group has a zero-tolerance policy for security infractions and a target of zero for stolen units from any facility within our network. At port facilities, the company partners with the local Port Authority staff and security companies to ensure the implementation of the most appropriate and best possible security measures. At plant facilities, where Original Equipment Manufacturers (OEM’s) typically manage security, the company works closely with the contracted security companies to ensure yard/areas that are within the responsibility of WW Solutions to secure. For yards other than those in ports or at manufacturing plants, local security companies are hired to manage the locations and secure the flow of vehicles both in and out of the yards. At all facilities operated by WW Solutions, scanning systems and regular yard inventories are used to track vehicles and prevent lost or stolen units.

Evaluation of results

WW Solutions was formed during 2017. Going into 2017, the component parts from which it was formed did not have harmonised metrics or targets to measure landbased security performance against. That situation is being rectified, but there will not be full-year data to report or comment on until 2018.

Ambitions and next steps

During 2018 various automated systems, such as RFID, with the potential to provide an even higher level of visibility and security throughout the company’s facilities, will be assessed. If the proof of concept is established the system will be strategically rolled out to facilities. Additionally, a project will be run during 2018 to define a company-wide KPI.

Security of vessels

The security of the fleet concerns the prevention of interference with, or harm to vessels, their crew or their cargo by unauthorised parties. This applies whether the effects of such interference would be consistent with the intentions or interests of WWL or not.

The group has a reputation for high-quality and dependable services. Vessel security breaches would have a corrosive effect on that reputation. Security is also important in terms of crew retention. For customers, vessel security is important due to its role in ensuring the timely and fault free transport of their cargo. Investors’ interest in the group’s vessel security relates to the negative impact the lack of it would have on the value of their investment.

Managing fleet security

Responsibility for fleet security lies with the Marine Operations Management Team. It is they who set the targets, define initiatives and assess performance in relation to security for all vessels in the fleet. All owned or controlled vessels must follow the company’s Ship Security Policy, which includes the basic requirement that ship managers adhere to all rules and regulations applicable to each vessel.

To mitigate the threat of piracy, each vessel’s Ship Security Officer (SSO) must be well familiar with the vessel specific Ship Security Plan ( SSP ) and the equipment relating to it. Regular drills are carried out to ensure that all officers and crew are fully aware of procedures within SSP. Under certain conditions a vessel may use the services of a Private Maritime Security Company (PMSC), however only in accordance with the strict requirements of the Ship Security Policy, including that the PMSC has been subject to due diligence.

Regarding stowaways, emphasis is put on prevention by providing vessels with relevant information for upcoming ports of call. The company also works with terminals in areas where stowaways are known to be a problem to assist them in improving routines, detection equipment, fencing and other deterrent measures.

Evaluation of results

There were 5 security breaches on vessels owned by WWL in 2017, all of which related to stowaways and, specifically, to the immigrant situation in European ports. The impact this type and frequency of breach has on cargo or operations is negligible.

Ambitions and next steps

In 2018 the company aims to establish security forums at regular intervals to enhance information sharing and best practice analysis. The Joint Maritime Security Working Group, (JMSWG) ensures and strengthens security competence and capabilities regarding security, facilitates the establishment of a coherent and efficient security network, and encourages the integration of security practices in day to day activities.

ESG supplier management

Each of WWL group’s operating companies procure products and services from a varied and globally distributed supplier base. As a significant buyer, the company can influence broader aspects of suppliers and their offerings, including those relating to Environmental, Social and Governance (ESG) performance.

WWL sees effective ESG management and performance as a sound proxy indicator of the general fitness of its supplier base. It is also a reflection of what is expected of the company by its customers.

It is in the interest of society in general that ESG factors be considered in supplier selection at all stages in the value chain. Ultimately, demand is the most effective driver of progress.

WWL actively uses ESG supplier evaluation criteria and processes in some business areas, such as vessel recycling. However, it does not yet have a group-wide policy or approach at this point.

Evaluation of results

A group-wide approach to ESG supplier management does not yet exist, therefore there is no data to report.

Ambitions and next steps

The company is now working on defining and putting into effect a group-wide policy for ESG supplier management. The approach taken to implementing the policy will be adapted to the needs of individual business areas, but it is anticipated that WWL will directly oversee ESG supplier management in most cases.

The company intends to have developed and implemented it’s ESG policy during 2018 and to have defined and begun reporting on KPIs in relation to it by the start of 2019.

Privacy and data security

In recent years there have been numerous high-profile cases of lapses in data security and privacy. Many resulted in serious operational, reputational and customer costs or losses. The EU’s far-reaching General Data Protection Regulation (GDPR) demonstrates officialdom’s level of concern with the issue and emphasises the need for close attention by industry.

As a large, modern and global organisation WWL maintains electronic records and relationships with its stakeholder groups, including customers and employees. The interests of the company and its stakeholders are aligned in ensuring the security and privacy of such information is not compromised and or exploited by third parties.

Information Seurity Management

WWL will comply with the 2018 GDPR regulation through its structured strategic approach to information security, which includes the implementation of a related set of policies and procedures. The company is putting in place systems and processes to report on the ‘Number of notifications to clients and data protection authorities’ arising from GDPR for the group. Responsibility and ownership of the process will be with the Data Privacy Officer (DPO).

Management of privacy and data security will also interface with ongoing projects and initiatives in information security in general, more specifically the implementation of an Information Security Management system.

Evaluation of results

As the requirements of GDPR take effect during 2018, preparations for reporting the chosen indicator have only been recently completed. Nonetheless, it can be confirmed that there have been no substantiated breaches from the launch of WWL in April 2017 up to the time of writing this report in February 2018.

Ambitions and next steps

WWL aims to have fulfilled the binding corporate rules (BCR) application prior to GDPR taking effect in May 2018. Separately, the information security management system will be reinforced to reflect industry best practice and policies to increase the overall maturity level.

Green innovation

WWL recently debuted its new ‘Lean:Green’ environmental strategy. The name coveys the importance of being environmentally progressive and the idea that being lean and green should be the same thing. Innovations that are truly lean and green can have great market potential, in their own right, or in terms of services that enable them to achieve scale. In short, ‘green innovation’ will go beyond reducing the company’s environmental footprint today; it will define and shape the group’s business in the future.

As with innovation generally, green innovation is best when it draws on the broad knowledge and competence of the organisation, but it has its focal point in the Marine Operations Management team for fleet related activities and with the President of WW Solutions for those relating to land.

For the group to create and capitalise on opportunities for the future, green innovation is a must. The aligned interest of the company’s investors, employees and customers, in the future success of the company, implies an interest in the green innovation of WWL too.

Collaboration for high impact changes

It is the companies stated vision to enable the industry’s journey towards the next generation of propulsion solutions for deep sea shipping. To do this it engages with innovators, suppliers, industry peers, academia and authorities to learn about, evaluate and contribute to the development of possible ways forward.

WWL’s approach to green innovation is guided by a set of six principles listed in the Environmental Policy. They include an emphasis on partnership, investing in lean:green solutions and focussing on high impact changes. The main initiative through which the company actively seeks innovations is through the Ocean Exchange innovation forum at which the WWL’s Orcelle Award is presented.

The company’s overall collaboration with the Ocean Exchange is led by the President of WW Solutions, who is a member of the board. Engaging the relevant members of WWL’s technical or business development staff in the annual event is the responsibility of the Head of Sustainability.

Evaluation of results

The strength and depth of the competing green innovations at the Ocean Exchange continue to grow as does the profile of the delegates. Of the twelve finalists in 2017, five were candidates in the Orcelle Award category, which was a record.

Ambitions and next steps

The ongoing objective of the coming years is to further increase the breadth and depth of the innovator group attracted to the Ocean Exchange while also increasing the scale and capability of Ocean Exchange itself through the recruitment of new sponsors.