Are Compliance Officers the Next "Must Have" for the Bunker Industry?

Thursday February 23, 2017

When it comes to technology and standards, the bunker industry is often, and rightly, accused of being stuck in the past. If you need convincing of this, look no further than two milestone events for the industry from the last 12 months.

The first was Yahoo dropping its "legacy" Yahoo IM service; few outside the industry would believe that in 2016, millions, if not billions of dollars of business was still being conducted on technology from the 90's.

The second was the January 1, 2017 introduction of mandatory mass flow meter (MFM) use for MFO bunkering in Singapore. Again, few outside the industry would believe that in a market where upwards of $11 billion of fuel was sold last year, the introduction of such a basic checks and balances system is an industry first.

But the industry is changing. And while some suppliers seem destined to be remembered as the industry equivalent of yesteryear's video rental stores, others are embracing new technologies and new thinking.

One company doing exactly that is Monjasa, who last month declared it was "leading the race" for improved quality bunker operations on a global scale.

This followed what Monjasa described as "the industry's most thorough independent testing, inspection, and certification" process, which was carried out by Bureau Veritas S.A. (BV), and examined Monjasa's compliance with ISO 9001:2015 for Quality Management, ISO 14001:2015 for Environmental Management, OHSAS 18001:2008 for Occupational Health and Safety Management.

And the sceptics should make no mistake; this was not a PR diversion from the company's recent less favorable headlines, it is a process initiated by Monjasa as far back as 2013.

Monjasa is also, as far as Ship & Bunker is aware, the only bunker company to have caught the attention of esteemed IT publication Computer Weekly, thanks to their innovative embrace of technology.

"At Monjasa, we have made significant investments in upgrading our compliance systems and in integrating them in the day-to-day of our business. Today, because of this, we meet and often exceed not only industry standards, but also compliance levels expected in the banking industry," Monjasa's Thorstein Andreasen told Ship & Bunker.

"I would not say this has been cheap, far from it. But I think it's the right way that companies should be doing business."

Andreasen says an example of where Monjasa's compliance technology comes into play on a day-to-day basis is through the scanning of IMO numbers at the point of inquiry.

"We have implemented systems that allow us to adapt to regulatory requirements in real time. In this sense, we have been one of the first bunker companies in the world to build work flows where our bunker traders can get full sanctions and compliance details on a vessel in less than a second by entering its IMO number at the stage of inquiry. We are at this point able to tell if this is a business we feel comfortable pursuing or not," Andreasen explained.

"Moreover, compliance always checks for sanctions, adverse media, political exposure, and other risk factors before traders start dealing with a new customer or supplier. Altogether, we have thousands of queries through our system, giving us the granular picture of the business that is required to ensure we are always compliant."

Monjasa says its Compliance department has become fully integrated into its business workflow through counterparty and vessel screening systems at all offices.

Perhaps more importantly, Andreasen says that being able to demonstrate this level of compliance has helped Monjasa to differentiate itself from their competitors and, ultimately, win business.

"This is definitely the way forward," he said.

"While dealing with the wrong company or supplying the wrong vessel these days can have critical effects on our ability to operate, what we are seeing from bunker buyers is they want to make sure they are dealing with a compliant counterparty.

"For major tenders, this is what they want."

Adding to this picture is this week's announcement by the International Bunker Industry Association (IBIA) it is set to draft a "guide to good practice for bunker suppliers."

So just as dedicated credit managers have become an indispensable part of a supplier's team, and many readers will remember when they were not, compliance officers might just be the next essential for the world's major players.