SAFETY4SEA: According to latest ‘Safety & Shipping Review’ by Allianz, what are the challenges in promoting a safer operating environment onboard? What are the lessons learned from the latest maritime accidents?
Capt. Andrew Kinsey: Shipping truly operates in a global economy and vessel operators are always under budget constraints. Rates have been cut and operators are having a difficult time making a profit. In an operating environment such as this Safety Initiatives can face challenges getting funded. However the data speaks for itself – a safe vessel is a profitable vessel. Down time, off hire time and claims deductibles all directly impact the profits of a shipping company. A well implemented Safety Management System can help reduce all those costs and aid a company’s bottom line.
S4S: In your view, has the industry been successful in implementing safety culture? What should be our key priorities for strengthening safety culture onboard and ashore?
Capt. A.K.: As our report highlights we have seen a marked improvement on the 10 year loss average, with shipping losses having declined by 38% over the past decade. However we still need to address the culture of risk taking within the Marine Industry. The behavioral issue of “normalization of risk” needs to be addressed in the Maritime environment. This is an issue for both shipboard and shoreside team members within shipping companies. Until we address the structural and cultural forces within our industry that drive our risk-tolerant decision making, we will continue to see preventable accidents occur within the Maritime Industry.
S4S: Do you think that the industry is ready for a more low-carbon future? What may be the biggest challenges to prepare? What are the serious problems that industry needs to address for the transition?
Capt. A.K.: The shipping industry has to be ready that is the bottom line. The question is has enough planning been done to ensure this. The answer to that question is time will tell. No matter how much planning is done, there will be unanticipated consequences to these regulations. We saw this occur when the Emission Control Areas were put into place. Remember that vessels operating within 24 nautical miles of the California coastline have been required to use distillate fuel with a sulfur content of 0.1% since July 2009. There is data available on what the IMO’s 2020 Global Sulphur Limit will mean with regards to machinery operations. A major question that remains is can refiners meet the new demand. As the recent cases of bunker contamination highlight this can be a delicate supply line.
S4S: Do you believe the maritime industry is behind others in the adoption of digital transformation? In comparison to other sectors, where do you think shipping stands? What is the biggest obstacle towards that end?
Capt. A.K.: With regards to the question of digitalization and the digital culture of the maritime industry; it is precarious to make too sweeping of generalizations. Certain segments of the industry are looking at vastly improved connectivity and digitalization is changing vessel operating practices. In certain trades, the potential for cost savings and streamlining is staggering. Look at the potential of blockchain to streamline the chain of custody of a container shipment. There has been tremendous resources expended to capitalize on the economy of scale with regards to container ship carrying capacity, however the documentation system in place for these shipment has remained relatively unchanged. But this is unproven technology within the marine environment and will not be a silver bullet. One of the biggest obstacles we face is separating the hype from the fact around the issue of digital transformation. A key factor will be development of global standards, not company specific logistics solutions.
S4S: Which shipping operations are most likely to be hit by cyber threats in the future?
Capt. A.K.: In order for the shipping community to properly evaluate our cyber security exposures we first need to understand that this is not a traditional maritime threat. For generations our training has focused tangible exposures; vessel traffic, storms and equipment breakdowns. Cyber is different, it does not delineate between shipboard and shoreside. If a system is connected to the internet it is a risk to a cyber event. Another misconception has been the cyber-attack scenarios which are being envisioned. Companies need to be more concerned with a denial of service attack (DoS) than someone taking control of the navigation of a vessel. The recent Cosco cyber event highlights the importance of having a plan and implanting it. Cosco notified their customers and provided specific instructions to help keep operations moving. As a result the incident was contained and the resulting damage limited.
S4S: What could be the potential downsides to fully-digitized ships? How do the cyber threats fit into the equation, and what solutions are being considered to fight them?
Capt. A.K.: I find it difficult to comprehend all the potential risks that a fully autonomous vessel presents. But the entire question of Automated versus Autonomous vessels has been mudded by misinformation. Currently operating vessels have a long history of automated equipment operation, and this will surely continue and expand. There are serious legal questions that need to be evaluated before the issue of an unmanned bridge can be resolved. This involves both IMO Regulations and National Laws. However, as with any internet-based system on a vessel, the cyber security profile of the operating systems needs to be fully addressed. In order to understand and manage any cybersecurity risk there are 5 key steps that need to be taken. First operators need to identify and protect their business’s vital data and technology assets, and then they need to learn how to detect, respond to and recover from a cybersecurity incident. Those 5 steps: Identify, Protect, Detect, Respond and Recover are the keys that need to be incorporated into a company’s cyber security policy.
S4S: Numerous statistics show that human error is the reason for the majority of shipping accidents. However, no one talks about how many accidents have been avoided due to clever actions of the crew in difficult moments at sea. Can it be assumed that accidents will continue to happen in autonomous shipping as well, especially because the crew will no longer be present at the scene?
Capt. A.K.: The “Human Error” factor in shipping losses is perhaps the most misused factoid from our Safety and Shipping Review. That statistic should be viewed as an indication of how many systems onboard a modern vessel still need human interaction in order to function. You would be hard pressed to find any system onboard an operating vessel that does not require daily human action in order to function properly. Also removal of the crew is not the answer to eliminate these losses. If the crew was not present the machinery would not run. Even in current automated shipboard systems you do not have the systems that can operate for a week straight without having the crew involved. Another key factor is just because you remove the human from the direct machinery operation, you do not remove the potential for human error in either the design or the remote monitoring of the system.
S4S: If you could change one thing about the shipping industry, what would it be and why?
Capt. A.K.: It would be the public perception of seafaring as an occupation. The job that seafarers do should be recognized and appreciated, and it is not. Merchant mariners are considered a commodity, it seems that the goals of most shipping companies are how can we have fewer onboard and pay them less. I strongly believe that seamen should be limited to a 4 month maximum rotation, and paid day for day vacation. Seafaring is mentally challenging and a physically demanding job. The fact is that a well-trained, well-rested and motivated crew is your best investment to help ensure a safe operation.
S4S: Which are the key drivers and barriers towards sustainable shipping?
Capt. A.K.: As the IMO laid out following the UN Conference on Sustainable Development in Rio de Jeneiro in 2012, there are three dimensions of sustainable shipping development. These are economic, social and environmental dimensions. Each of these dimensions poses their own challenges and barriers. One of the greatest challenges that shipping faces is that is that it truly operates in a global economy and freight rates continue to face significant downward pressures. We also see the challenges that evolving environmental regulations create. This includes both the upcoming sulfur limit as well as ballast water management laws. There is also the question of what the future of shipping will look like, what will vessel look like and what will be the nature of our cargo? One key is the fact that as long as goods are being transported between continents they will be moving on ships. As a result it is critical that we continue to have reliable vessels and trained manpower to operate them.
S4S: Regarding future of shipping, which could be the best practices or other form of meaningful feedback that you would like to share with the industry to move forward?
Capt. A.K.: A key issue here is that while we breakdown losses into many categories and driving issues, the fact remains that many of the contributing factors are interconnected. For example the importance of updating the International Maritime Dangerous Goods (IMDG) Code goes hand in hand with the rise of Ultra Large Container Vessels as well as development of new technologies; carriage of lithium batteries and vehicles powered by flammable liquids or gas. A major issue moving forward will be how we can utilize the massive amounts of data that is now being generated from AIS information, Voyage Data Recorders as well as ECDIS Installations onboard to help identify, manage and hopefully eliminate maritime risks going forward.
The views presented hereabove are only those of the author and not necessarily those of SAFETY4SEA and are for information sharing and discussion purposes only.
Captain Andrew Kinsey is a Senior Marine Risk Consultant, Allianz Global Corporate & Specialty.