Unlocking the potential of Maritime Management Systems (MMS)

DNV webinar, 3 February 2022

The webinar presenters

Georg Smefjell Marte B Glosli Paul Kuin Carl-Erik Høy- Simon Adams
Group Leader Senior Engineer, Principal Auditor, Petersen Sr Comms Manager
Management Systems Regulatory Affairs Maritime Management
Systems
Business Development Webinar host
Leader

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 AGENDA

• How to utilize DNV’s Fit for Purpose MMS services

• The DNV Compliance Planner - a handy tool
• In the context of MMS:
• Decarbonization & EEXI/CII
• ESG (Environmental, Social, Governance) management
• Q&A

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Utilizing Maritime Management Systems potential
Maritime
Management
Optimizing Systems service
Effectively Ensuring trust &
operations menu
Systematically ensuring & confidence in
reaching goals & documenting performance and
Resource Seamless:
objectives ongoing performance data
efficiency & packaged &
compliance
common platform delivered by
Using resources Today’s focus:
of operations Maritime
where it matters Providing ESG and decarb
Performance Data as examples
Focusing on Meeting your
needed
opportunities needs, utilizing
common context &
systematic

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 DNV’s role as RO

Verification of compliance by determining:

.1 conformity of the safety management system (SMS) with ISM

requirements

.2 that the SMS ensures that ISM Code objectives are met

Ensuring that [audits are] assessments of effectiveness of the

SMS in meeting specified objectives, rather than conformity
with detailed requirements in addition to those contained in the ISM
Code

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The aims of the ISM Code

ISM Code objectives:

• Safety at sea
Support &
encourage Allow companies
• Safe working
development of to develop
environment
safety culture in solutions which
shipping best suit
• Avoidance of that company,
damage to the (rather than blind operation or
environment and to compliance) ship
property

• Compliance

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 DNV’s "Fit for Purpose" MMS solution

Seamless MMS w/ISO Stnd.

Industry standard
Requirements

Company/DOC Holder Making Based on One Mngt Based on Assess-

Mngt your System partner- ment of
Flag Req’s Systems performance One audit ships MMS
services Fitting your measures’
Multiple Placing
fit for needs effective-
purpose certifi- focus ness
Utilizing cates where
ISM/ISPS/ synergies it matters
MLC, 2006

Work Scope

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 Core of Fit for Purpose MMS systematics

1. Identify: 2. 3. Identify baseline & 4.

Consistently
• Goals performance Regularly monitor &
identify/develop/
• Objectives indicators document
maintain measures to
• Requirements on measures’ performance
meet them
• Expectations effectiveness

8. Audits & reporting on 7. 6. 5.

Annual
MMS effectiveness in Share information on Perform internal
documentation of
reaching: MMS effectiveness assessments
performance
• Goals
• Objectives Partnership on audit Management reviews
Developments from
• Requirements focus setting & internal audits
baseline
• Expectations

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One MMS systematic
Compliance, optimization, sustainability & green shift
Business • MMS & ESG: ISM, MLC, 2006 and Seamless (ISO 9K, 14K, 45K & 50K)
target(s) • MMS & Decarb (SEEMP III/CII): ISM and Seamless (ISO 14K & 50K)
Cross use of measures and performance data

Context • Identifying what impacts operations and targets

• Identifying requirements, goals & expectations and the need for evidence on effective and
definition consistent handling

• Identify where you need performance data

Risk • Identify performance indicators
identification • Establish baseline

• Monitor
Risk • Perform internal assessments
prioritization • Identify Top Concerns

Preparation and planning

Formulation • Use established baseline, identified performance indicators & share performance data
of focus area • Agree focus areas

• Pre-audit dialogue, and common audit aim

Audit • Assess effectiveness of MMS in meeting objectives & ensuring compliance
preparation • Annual Audit Plan - focus setting where it matters
DNV © • Audit preparedness
 AGENDA

• How to utilize DNV’s Fit for Purpose MMS services

• The DNV Compliance Planner - a handy tool
• In the context of MMS:
• Decarbonization & EEXI/CII
• ESG (Environmental, Social, Governance) management
• Q&A

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The DNV Compliance Planner – a handy tool

• Exclusive to DNV classed vessels

• Available on the Veracity portal
• Upcoming changes to statutory
requirements
• Will soon also include Flag
Interpretations
• Tailored to your fleet
• Recommended compliance actions

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 Read about DNV Compliance Planner at dnv.com

DNV Customers are encouraged to test the

Compliance Planner themselves in the Fleet Status
on Veracity
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 AGENDA

• How to utilize DNV’s Fit for Purpose MMS services

• The DNV Compliance Planner - a handy tool
• In the context of MMS:
• Decarbonization & EEXI/CII
• ESG (Environmental, Social, Governance) management
• Q&A

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How to implement EEXI/CII in the management system

• Management system structure

• Context changes
• Implementation dates
• Manuals
• Responsibilities and authority
• Setting targets
• Monitoring and reporting
• Corrective action plans

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Management system structure
office

Safety Management System

ISM-Code

ISO
14001

Energy Efficiency Management System

ISO 50001:2018

MRV / DCS MARPOL

ANNEX VI
EEDI / EEXI / CII / SEEMP

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Context changes
(ISM1.2.3 / ISO14001 / ISO50001(4.2))

• Business impact and risk

• Focus on midterm and long term
objectives
• Is my fleet fit-for-purpose for the future?

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Implementation dates
(ISM12.7/ISO14001/50001 6.1./9.1)

• All ships above 400 GT - by 1 January

2023: Develop an approved energy
efficiency improvement and
decarbonization plan: SEEMP Part 3

• Cargo and cruise ships above 5000 GT –

every year from 2023: Annual CII (Carbon
Intensity Indicator) and rating A to E. Each
ship needs to achieve rating C or better

• EEXI as per first IAPP survey after

January 1st 2023

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Additional responsibilities and authority (EEXI with EPL)
(ISM 3.2& 5.1&5.2 / ISO14001 / ISO50001 5.3)

• Ensure the responsibility for reporting

the use of a power reserve to the
RO/Flag is identified and tasks are
managed

• Engine power limitation: overriding

authority of the Master and Navigation
officer for the purpose of securing the
safety of a ship or saving life at sea

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Setting targets
(ISM 7/ 1.2.3) (ISO14001 /ISO50001 6.1./6.2)

• How is the annual operational CII for the next 3 years defined?
• CII: 2023-2026 annual baseline: 5 %, 7%,9%,11% (compared 2019)

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Energy efficiency measures and plans
(ISM7 / ISO14001 / ISO50001 8.1)

• SEEMP (CII)
• OMM (EEXI):Onboard Management
Manual when:
• EPL: engine power limitation

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Monitoring results is essential
(ISM 7 / ISO14001 / 50001 9.1)

Fuel Oil Consumption Report Statement of Compliance Emissions Insights Dashboard

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Corrective actions when targets have not been
achieved
(ISM 9.2 / ISO14001 / ISO50001 10.1)

• If rating D for 3 consecutive years or rating E: develop and implement corrective actions
to achieve rating C or better
• Corrective action plans are submitted to the verifier for the SEEMP

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A broader context, beyond energy efficiency

• Business impact and risk

• Focus on midterm and long- term
objectives
• Is my fleet fit-for-purpose for the future?

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 AGENDA

• How to utilize DNV’s Fit for Purpose MMS services

• The DNV Compliance Planner - a handy tool
• In the context of MMS:
• Decarbonization & EEXI/CII
• ESG (Environmental, Social, Governance) management
• Q&A

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 Increasing expectations to ESG

The shipping industry is experiencing an

Regulators Financiers increased attention towards ESG and
decarbonization from multiple stakeholders
like regulators, financers and cargo owners.
Cargo owners Employees There is a demand for a fact-based
scientific disclosure of your sustainability
story.

Media Public opinion

Business as usual is
no longer an option.
Charterers Insurers

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International Panel Climate Change (IPCC) report: Code RED

Stakeholders are accepting that we have a

climate crisis
How companies responds to this
will be decisive for their survival

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Change in stakeholder impact

In addition to shareholders, cargo owners

and finance you need to assess impact of
your total value chain in a new way

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Increasing reporting requirements

Stakeholders are requiring more

transparency and more substantiated facts
in reporting ESG* reporting is becoming a
requirement

*ESG – Environmental, Social and Governance

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How ESG can be linked into Management System processes
and existing “fit for purpose” audit process
• Management system standards are moving
towards aligned structures with common
principles, simplifying an integrated approach.
• There are clear requirements to connect the
management system to company strategy and
business processes through definition of business
context, identification of stakeholder expectations
and risk-based thinking
• The DNV “fit for purpose” process is integrating
several management system aspects to be able
to utilize synergies, avoid silos and maximize
benefit.

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Using the management system framework to address
ESG related topics (ISO example)
4.1 Internal and external business context 5.1 Business Strategy

• The organization shall determine external and internal issues

that are relevant to its purpose and its strategic direction and 5.1 Aim and intended outcome
that affect its ability to achieve the intended result(s) of its of the Management System
quality management system.
• ESG topics should be assessed as part of this process
4.1 Internal and external 4.2 Expectations of interested
business context parties
4.2 Expectations of interested parties

• What does your internal and external stakeholders expect with 6.1 Risk & Opportunity
respect to ESG? Assessment
• What are their ESG reporting expectations, frequency,
content? 5.1/8.1 Embedding into
6.2 Establish Objectives
Business Processes
6.1 Risk & Opportunity Assessment
9.1 Monitoring & Evaluation of
• Are there ESG related risks for your organization – e.g climate Business Performance
risk, compliance risk, supply chain risk?
• Can you as a company take actions to gain advantage over
10 Improvement
competition?

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Typical ESG indicators

Environment Social Governance Activity metrics

Greenhouse Ecological Air Quality Employee Accident & Business ESG Number of
gas emissions impact health and Safety ethics governance shipboard
safety Management employees
Gross global Scope 1 Spills and releases Air emissions (i.e., Lost time incident rate Port state control Corruption risk Fines (total amount of Total distance
emissions (CO2) In (number of spills and NOX, SOX, PM) (LTIR) or Lost time (number of port calls monetary losses as a travelled by vessels
Metric tons (t) aggregate volume) incident frequency to 20 lowest CPI result of legal
(LTIF) ranked countries) proceedings
Scope 2 and 3 associated with
emissions becoming bribery or corruption)
more common

GHG emission Travel days within Crew welfare, e.g. Marine casualties Gender diversity and Ship Recycling Operating days
intensity (AER or marine protected measured through inclusion (typically strategy and
EEOI) areas or areas of Retention and separating shore side, implementation
protected turnover rates management and
conservation status crew)
Number of Conditions Deadweight tonnage
of Class or
Recommendations

Number of vessels in
total shipping fleet

Number of vessel port

calls

Transported cargo

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Typical sustainability and ESG implementation in company
processes
Decarbonization strategy
People & social Aspects Streamline (and
Corporate governance automate)
ESG reporting
Value chain aspects

ESG Implementation process

Understanding Running business

ESG data
stakeholder’s ESG ESG strategy, - ESG in
collection,
expectations and KPI’s and operation
verification and
determine implementation continuous
reporting
risk/opportunities improvement

Sustainability
Sustainability and ESG
and ESG Sustainable and Green
Governance processes
Training and Culture
Training Finance
Fleet development
Decarbonization in operation
Value chain aspects
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What should you do now?

Focus on Engage your Engage in dialogue

understanding and stakeholders to with investors on how
managing your own understand what are they perceive ESG risk
ESG risks your material ESG risks now and in the future

Understand the
Internalize the
difference between Prepare for data
process to be pro-
public and private collection and reporting
active, focusing on
finance and how it of your impacts to your
the material issues
affects your access to stakeholders
first
capital

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Combining MMS & ESG – The effective solution

ESG MMS Mandatory MMS Voluntary

Environmental ISM ISO 14001
Today's example: SEEMP III/CII ISO 50001
Social ISM ISO 45001
MLC, 2006
[Corporate] Governance ISM ISO 9001

Why choose DNV for demonstrating ESG and sustainability in the shipping industry:
• Maritime industry insights and deep technical domain knowledge
• Help in navigating continuously changing environmental regulations
• Long-standing corporate ESG experience and expertise in managing risks related to ESG
• Cross-use of performance data for documenting compliance and meeting goals and expectations
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• DNV Fit-For-Purpose integrated audit can help you link ISM, MLC, ISPS, ISO and ESG into one management system
Unlocking your hidden potential of
Maritime Management Systems (MMS)
DNV helps you choose the smartest path.
Contact your ISM Auditor, Account Manager or email us at esg@dnv.com

More on MMS More on ESG

https://www.dnv.com/mms https://www.dnv.com/advisory-esg

www.dnv.com

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 Thank you for joining!

www.dnv.com

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