Our business standards and anti-corruption

We have clear policies on ethics and anti-corruption. We do not tolerate any form of corruption, and we expect all employees to live up to the high ethical standards we lay down in our governing documents and code of conduct. Business standards work is ongoing and constant, and our various stakeholders depend on us being a transparent and compliant partner.
News |

Six principles guiding our anti-corruption efforts

We follow internationally recognised guidelines in our anti-corruption work, such as the Foreign Corrupt Practices Act (FCPA) and UK Bribery Act 2010. The six principles outlined below form the basis of our anti-corruption efforts.

1. Top-level commitment: We have a clearly articulated policy against corruption. Our group management team, constantly communicate their commitment towards zero tolerance for any kind of corrupt activities throughout the organisation. The management team has the full support and encouragement from the board.

2. Proportionate procedures: Our anti-corruption measures are proportionate to the variation in risk we have across our diversified organisation and the various parts of the world where we operate.

3. Risk assessment: Corruption risk assessments are carried out in all our business areas, identifying whether we face a high, medium or low risk. The risk varies, depending on geographical location and the nature of the business we conduct.

4. Communication (including training): We constantly communicate the anti-corruption policy in order to make sure that our policy is understood throughout the organisation. Anti-corruption training is compulsory for all employees.

5. Due diligence: We conduct due diligence of business partners where appropriate and in a variety of forms. The comprehensiveness of the due diligence conducted is proportionate to the risks. We utilise licensed screening systems to conduct due diligence in-house and, if necessary, source from third party consultants.

6. Monitoring and review: We acknowledge that monitoring, reviewing and reporting is challenging, yet essential to ensure effective implementation.

The boards of Wilh. Wilhelmsen ASA (WWASA) and Wilh. Wilhelmsen Holding ASA (WWH), as well as the group management team receive and review quarterly anti-corruption reports. To ensure our data is  accurate, we have a number of reporting initiatives including a whistleblowing channel, giving all employees the opportunity to anonymously report irregularities, thorough investigation of complaints, audits of risk exposed areas of operation, and third party verification of our anti-corruption procedures. All potential breaches are handled according to our routines and regulatory framework.

Incidents in 2016
Antitrust investigations
Two Wilh. Wilhelmsen ASA (WWASA) joint ventures, Wallenius Wilhelmsen Logistics (WWL) and EUKOR Car Carriers (EUKOR), have together with other companies in the car carrying industry been under antitrust investigations since 2012.

The authorities in Japan (2013), South Africa (2015) and China (2015) have fined WWL for antitrust behaviour. EUKOR was also fined in China (2015).

In July 2016, WWL entered into a settlement with the US Department of Justice (DOJ) with regards to breach of US antitrust laws covering activities from February 2000 to September 2012. Through this settlement WWL agreed to pay USD 98.9 million in fines. EUKOR did not receive any fines in
the US.

WWASA has made necessary provisions, totalling USD 231 million, for its share of the fines issued to or expected to be issued to the joint ventures.

WWL and EUKOR continue to be part of antitrust investigations in some jurisdictions, of which the EU is the biggest jurisdiction. As some of the processes are confidential, we are not in a position to comment on the ongoing investigations within the respective jurisdictions. The processes are expected to continue to take time, but further clarifications within some jurisdictions are expected during 2017.

Fraudulent incidents
In 2016, we experienced an increase in external fraud attempts through cyber/email "attacks" with various degrees of sophistication. Also, the more typical whaling (CEO) fraud attempts occurred where the fraudster takes the identity of one of our business leaders requesting bogus payments. We
have not faced any major financial losses due to these attacks.

These kind of fraud attempts seem to have been part of an international trend across various industries. We have during the year made sure that our organisation, on a regular basis, has been reminded about these fraud attempts and the various scenarios that have occurred. These reminders, in addition to making sure we stick to our internal control procedures with regards to payments, are of paramount importance in order to avoid losses. In the most risk exposed geographical areas we operate, we frequently remind our customers about the danger of fraud attempts.

In 2016, we experienced two relatively substantial internal fraud cases. The most serious one involved two employees who managed to circumvent our internal control procedures of cash handling. Both cases were handled in accordance with internal procedures. The on-going efforts to limit the use of cash as the method of payment will continue (still unavoidable in some geographic areas) together with a focus on enhancing our internal control procedures.

All major cases have been and will be reported to the police.

Joint ventures
Although our joint ventures, associates and available for sale assets are not part of our programme or measurements, we expect them to operate with the same high standards on ethics and compliance. The expectations are clearly conveyed through board members of the respective companies. In addition, we actively share our policies and best practice documents with our joint venture partners and operating companies with the aim of moving towards alignment of anti-corruption standards and practices.

Focus in 2016
The group wide anti-corruption programme “I Comply” was rolled out in the second half of 2014. The roll out and focus on the programme has continued since then, with emphasis on e-learning modules, training through workshops and addressing the importance of our anti-corruption work at management
conferences throughout our organisation. All new Wilhelmsen employees receive this training as a mandatory course when joining Wilhelmsen. In 2016 a total of 706 employees took the Wilhelmsen Business Standards Course which focuses on our Code of Conduct, our Anti-Corruption Policy, the prevention of fraud and theft, and our Whistleblowing Policy.

In 2016, 99% of the seafarers on the Wilhelmsen controlled fleet have successfully passed the compliance training. These results were achieved despite limitations caused by the fact that seafarers sign on and off, and new seafarers come into the pool.

In 2016, Wilhelmsen Ship Management (WSM) managed to get all their existing seafarers to complete the compliance training. This focus will continue and the goal is to make sure all new seafarers have completed their compliance training within the first contract after joining WSM. The total WSM completion ratio is now at 94% out of the seafarer pool of 8 450 seafarers.

In 2015, we said that one of our targets for 2016 would be that 100% of our land based employees should have completed compliance training. By the turn of the year, 98.5 % had completed the mandatory training. Lack of follow up on deadlines for new employees due to heavy workload with restructuring processes explains the underperformance. Initiatives have been put in place to ensure goal achievement in 2017.

For a selected and risk exposed group of employees we started the roll-out of our competition law training (eLearning) in the fourth quarter 2016. Our goal was to train 100% of the pre-defined group. As of early January 2017, we have reached a total of 98%. In addition, a large number of the
employees being part of the "move" to Survitec have done this training but are not part of our statistics.

Significant steps towards a corruption free industry
Historically, facilitation payments have been a big challenge within the shipping industry. In February 2015, we rolled out a zero tolerance policy on facilitation payments on all Wilhelmsen owned vessels in all ports around the world.

Wilhelmsen was one of seven ship owning companies participating in a Suez pilot project run by the Maritime Anti-Corruption Network (MACN). The project kicked off on 9 December 2015, marking the International anti-corruption day, and lasted until 9 April 2016. The purpose of the project was to implement a zero tolerance policy against handouts/gifts (facilitation payments) in Suez Canal transits. The project has resulted in less demands being made and made it easier for captains to say NO when in transit. Plans are now made to broaden the project by involving additional MACN members and other stakeholders.

Historically, a single Suez transit has required the handout of 40-50 cartons of cigarettes. In 2016, our records show that 28 out of 30 transits were completed without any form of facilitation payments. The only situation that allows for a deviation from our zero policy is when our employees are facing a situation where there is a health or safety threat to our crew, vessel or cargo.

The feedback from our vessels is that our anti-corruption efforts are working. They notice a change in attitude based on our zero tolerance stand, and that the “new” generation of pilots and port officials bring with them a new attitude towards the historical and cultural based demand for facilitation payments. This is a major shift in the maritime world towards a corruption free industry. Even if the situation in Suez has improved, it is still a way to go in eliminating continuous demands towards our officers and the strains they feel by having to deal with such unpleasant issues that should not be part of their jobs.

Our zero tolerance policy applies not only to Suez transits, but all canal transits and port visits worldwide. In 2016, our vessels called 287 visits to ports we have identified being in the high risk category (frequent demands for facilitation payments), only on one occasion has a small payment been made. Port State Control (PSC) in Venezuela boarded the vessel and threatened with four to five days detention due to minor deficiencies unless the vessel paid USD 500. Eventually USD 200 was paid to get the vessel released. One similar incident, however without payment, has occurred in the same port afterwards. An appeal process together with the Flag state has been initiated to prevent further recurrences.

The illustration below shows the Wilhelmsen controlled fleet's port calls in 2016 in geographical areas where the risk of corruption is high according to Transparency International's Corruption Perception Index. The illustration shows the number of port calls made and the number of demands for facilitation payments in the respective country.


The few and minor payments made in 2016 have been (with the exception of the Venezuela incident) according to the exception in our anti-corruption policy; if faced with a threat to our crew and/or vessel that could lead to a serious medical or safety emergency, a payment could be justified.

An internal audit project has been conducted in 2016 in WWASA with regards to verification of their zero tolerance policy on facilitation payments. A total of nine WWASA owned vessels were selected and the audit covered these vessels port visits in five exposed locations/ports during the second half of 2015 (a total of 20 port calls). The audit did not detect any deviations from their zero tolerance policy. It is important for us to verify that we “walk the talk”, these efforts will continue with increased strength in 2017 and will include a wider part of both our Business Standards and our organisation/companies.

Industry partnerships
We believe in partnerships in our fight against corruption. In addition to taking part in the Maritime Anti-Corruption Network, we were accepted as members of Transparency International Norway at the beginning of 2016. Being part of their network allows us to draw on their expertise and experience with corruption in various parts of the world on how to best deal with the training needed and the challenges our personnel will face. We have participated in several Transparency International seminars where we have shared our experiences and challenges with other members across various sectors. We have further contributed towards a corruption dilemma collection to be launched by The Confederation of Norwegian Enterprise (NHO) in cooperation with Innovation Norway and Transparency International in March 2017. The purpose for this collection is to be used by companies in their anti-corruption training and utilised by universities for educational purposes.

WSM was certified by TRACE, an anti-bribery standard-setting organisation, in early 2016. This demonstrates our commitment to commercial transparency and allows WSM to serve as a valued business partner to multinational companies. “By independently becoming TRACE Certified, WSM is helping to raise anti-bribery compliance standards across the shipping and maritime industry. We applaud them for their commitment to integrity and transparency and look forward to other ship owners and logistics companies continuing to follow their lead,” said Alexandra Wrage, president and founder of TRACE International.

Parts of the Wilhelmsen Ships Service (WSS) organisation achieved TRACE certification in 2016. We aim at achieving further certification for relevant parts of the WSS organisation in 2017.

A general observation and trend in 2016 is that our customers in an increasing scale ask us to verify that we have our house in order when it comes to anti-corruption initiatives. We very much appreciate this trend and believe that our extensive efforts to be in compliance will distinguish us and provide us with new business. 

We have also experienced an increasing focus on anti-corruption and other compliance matters related to M&A activities. The number of questions and requirements for disclosure related to possible issues clearly illustrates the growing importance of compliance if you are disposing or acquiring assets. We believe that this trend will continue in the coming years.

Risk assessments
WSS, WSM and WWASA each assess risk on a business area basis. WSS is the business area within Wilhelmsen with the highest number of land based employees, with a capacity to provide service and products to the maritime industry in 2 200 ports in 125 countries. Due to the magnitude of their operations and their exposure by operating in geographical areas where corruption in general is widespread, WSS has in 2016 conducted a corruption risk assessment.

The outcome of the assessment was that the main risk factor relates to the general level of corruption in the country of operation. WSS does not operate in high risk sectors, typically being identified as extractive, defence, and heavy engineering, where operations are linked to government approvals and the winning of licences. Therefore, the WSS exposure to the risk of “grand” corruption is low. The typical exposure would be related to facilitation payments or petty corruption. WSS’ business is predominantly of transactional nature.

WSS realises that individual breaches to our anti-corruption policy may occur regardless of how much efforts and resources are put into anticorruption work. The focus is therefore to ensure that any system or routine breaches of the policy that potentially could accumulate into major breaches are eliminated.

In WSM, the main challenge revolves around corruption and bribery in the vessel operations. Port official in countries such as China, India, Thailand, Brazil, Chile for example are still requesting for facilitation in the form of cigarettes and /or cash. Ships are trying their best to avoid these payments with strong support from shore.


Zero tolerance policy on corruption
We operate in many geographical areas were corruption and bribes are still a major problem. We recognize that even if we see a move in the right direction, our efforts will have to continue and be further strengthened throughout our organisation. However, our long-term goal is firm. Our ambition is a corruption free industry.

In 2017, we will continue to focus on “living” our business standards. Learning and understanding the standards are important parts of our recruitment routines and new employees undergo mandatory business standard (ethics) training. We will continue emphasising our zero corruption tolerance goal and expect all our employees to say no to corruption. Our ambition is to increase our focus on internal compliance audits in order to verify and document that we “live” our zero tolerance policy on corruption.

Personal data protection policy
In 2016, we have been preparing for the introduction of a global Wilhelmsen personal data protection policy ensuring that we adhere to current and planned legislation expected to come into force in 2018. We are planning to roll-out and implement this new personal data protection policy for the whole organisation in 2017.

Competition law training
For a selected and risk exposed group of employees, we will continue competition law training. Our goal is to train 100% of the pre-defined group. The competition law training will continue in 2017 making sure that we each a 100% participation on the pre-defined group and making sure all new relevant employees are included. In addition, workshops will be organised providing further details and follow up for selected employees.

In 2017, we will also focus on building a culture with increased emphasis for blowing the whistle/raising a concern if something irregular is detected. We have since late in 2014 been operating an internal whistleblowing channel (email based were complaints/whistles are being forwarded to WWH Compliance).

Our experience is positive but we would like to develop this further by introducing a whistleblowing channel also being available for external stakeholders (vendors, customers, JV partners, etc.) and that guarantees anonymous reporting if requested (a third party intermediary in the reporting line will ensure this). The purpose of this is to get more whistles and better quality making sure that potential irregularities are detected and dealt with as early as possible. As of the second quarter 2017, we are planning for our business standards and compliance training to include the modules shown to the left.