Sustainable Shipping Initiative and Institute for Human Rights and Business: Delivering on seafarers’ rights

In 2020, SSI members and IHRB joined forces to develop a new human rights code of conduct and due diligence guidance on seafarers’ rights, designed to close the gap in labour and human rights policy and practice. While Covid-19 brought seafarer welfare into sharp focus with more than 400,000 seafarers stranded, broader issues relating to working conditions had been present well before the pandemic.

SSI has long sought to deepen the industry’s understanding of the barriers and opportunities for positive impact across and beyond the shipping value chain. Through the Roadmap to a sustainable shipping industry, SSI lays out six vision areas that must be addressed: Oceans, Communities, People, Transparency, Finance, and Energy.

Supported by a group of SSI members (Forum for the Future, Louis Dreyfus Company, Oldendorff Carriers, RightShip, South32, Standard Chartered Bank, The China Navigation Company and Wilhelmsen Ship Management), this piece of work will result in a tool to help charterers, shipowners and operators put their commitments to protect and respect seafarers’ rights into practice, going beyond legal and regulatory compliance and raising the bar on seafarers’ working conditions, well-being and welfare.

The issue

According to SSI Head of Partnerships and Development Nicole Rencoret, who is leading SSI’s work on Delivering on seafarers’ rights,“the global pandemic has shown that despite the human rights standards in existence, we’re still seeing many non-sustainable and sub-standard practices – to the detriment of our seafarers without whom society could not function. And while it once might have been a case of ‘out of sight out of mind’, shipping stakeholders are increasingly aware of their power to push for better working conditions and protect the rights of seafarers. For example, through the incorporation of observance of seafarers’ labour and human rights in contractual terms and chartering provisions.”

Partnering with IHRB is a natural fit, given they work with companies to leverage collective action. IHRB Deputy Chief Executive Frances House says, “We need to consider human rights risks and responsibilities in terms of  a continuum and baton-passing from ship financing and building through operation to recycling. Each actor around the ship lifecycle has leverage at different points to raise standards.”

While many charterers are undertaking significant human rights due diligence in their land-based supply chains, fewer are doing so with regard to ocean transportation. This is a gap which SSI and IHRB seek to address, together with the Rafto Foundation for Human Rights in Norway which is bringing its expertise to the table on this project too. “Working collectively on development and implementation of a human rights framework with SSI members can move the needle for the industry.”

The project collective

“The magic happens when SSI members are together in the room – which these days tends to be digital! Sustainable shipping requires collaboration. We need to work hand in glove with actors across – and beyond – shipping to tackle the systemic challenges that create risks for seafarers,” Nicole says.

The overarching aim of this work is for the code of conduct and due diligence guidance to be mainstreamed within the industry. “We’re developing practical tools that will go beyond compliance with current laws and regulation,” Nicole adds.

IHRB brings the strategic experience that’s required to support the initiative. “We’re just beginning a similar process with the Consumer Goods Forum and container cargo owners such as Unilever, Target and IKEA. The retailers and manufacturers are consumer-facing, so there’s been more scrutiny of their human rights practices – and the industry leaders are further down the route of conducting human rights due diligence to drive positive change in their supply chains. There’s quite a lot of mutually reinforcing experience that we can learn from in terms of leveraging leadership,” Frances explains. 

What are the priorities? 

The clear starting point is stronger awareness of the issues, but the next step is mobilising the groups that may have previously felt powerless in raising the bar on seafarers’ rights. “The crew change crisis has led to CEOs co-writing letters to the UN secretary general and influential groups calling for government action. We want to build on this momentum and challenge shipping actors and their customers to play their part in doing something about this,” Nicole explains.

In addition, the IHRB team believes including worker voices from the outset is of paramount importance. They’re reviewing insights from Mission to Seafarers, ITF and others. “We know that the drive to cut the manning levels and costs comes at a massive price in terms of mental health and fatigue,” Frances points out.

She adds that another significant challenge is the systemic way in which seafarers find their employment. While largely unreported, many are paying thousands of US dollars simply for a labour broker to secure a job for them. “This often means they are debt-bonded before they begin, with loan sharks demanding high interest payments during their service. We need to reverse that, with practical guidance and alternative solutions,” Frances says.

Driving long-term change  

The good news is that many industry players recognise the need for improved accountability. “More and more cargo owners are saying, ‘these are my goods – we need to do something about the way they are getting from A to B’,” Frances suggests. At the same time, investors and banks are focusing increasingly on ESG performance and mandatory human rights due diligence for EU

Overall increased awareness of the crisis faced by seafarers  during COVID also means stakeholders who may be more distant from the day-to-day ship operations, leaders and the general public are seeing the human face of this work and the risks people face.

Charterers are increasingly under scrutiny for their supply chains, with customers demanding more transparency which in turn will require more comprehensive and systematic due diligence. By demanding transparency on how shipowners and operators are addressing labour and human rights risks, charterers can make informed decisions for more sustainable supply chains.

Nicole agrees and believes that in addition to charterers, a push for change will come from lenders, investors and insurance providers, with sustainable finance leaders calling for a shift in culture and behaviour. “Banks realise they have this leverage, and they’re using it to make decisions around lending – ultimately rewarding those who demonstrate respect for the labour and human rights of seafarers,” she says.

Capitalising on momentum

The pandemic has brought about increased awareness of seafarers’ rights and a strong desire for change. SSI, IHRB and Rafto are working with companies to drive this project while the spotlight is on seafarers, and aim to  launch of the code of conduct on the International Day of the Seafarer on June 25, 2021, followed by the due diligence guidance later in the year.

That said, the project doesn’t have an end point. “Sustainability is a journey: it’s both a challenge and an opportunity. What we are working on represents a step along that journey, and we have to keep working on delivering on seafarers’ rights by integrating them into business operations until it becomes a norm. And even then, we have to continuously monitor and keep pushing that bar higher,” Nicole says.

Frances concludes, “Success is achieved when human rights due diligence and accountability are mainstreamed. It should be a requirement for financiers, insurers and customers. Once these expectations get translated into a contract, there will be sanctions for those who don’t comply.”

Learn more about SSI and IHRB’s Delivering on Seafarers’ Rights initiative