Creating A Uniform World

Within global supply chains, risk management is often the unspoken variable. Recognized standards for security practices have frequently fallen victim to lack of understanding, poor execution, and unregulated handling of goods. The blame is often difficult to assign, as shipments regularly change hands, accountability becomes diluted. With the implementation of ISO 28000, a benchmark of international standards will be set, seeking to coalesce the individual codes of nations among the various supply chain industries.

The International Standards Organization (ISO) has recently introduced the newest voluntary standard, ISO 28000, requiring exporters to ensure that all consignments are subject to a series of checks prior to the goods being packed and containerized. The global objective seeks to anticipate, reduce, or eliminate any potential risk to shipments prior to departure, as well as minimizing threats throughout the greater supply chain. In September 2007, DP World became the first terminal operator to comply, seeking to establish a new precedent within the industry.

“We are delighted to have achieved this certification,” said DP World Chairman Sultan Ahmed Bin Sulayem.

“This is the very first time that any global company in our industry has met such a rigorous international standard, and is testament to DP World’s commitment to the highest security management practices. It is impossible to overstate the importance security plays in our business, to our customers and to DP World.”

Though ISO 28000 will remain voluntary, the newly established security standard acknowledges those within the supply chain willing to minimize risk, alleviate fraud, and accelerate transit times. Cost-savings could prove beneficial as well, as the price of insuring cargo is expected to be reduced with ISO 28000 certification.

“The compliance with ISO 28000 requirements, should lower insurance claims. A proper monitoring system in place and better control over the goods should make claims easier and quicker. As well as theft, insurance fraud will become difficult, if not impossible, to stage,” said Jasamin Fichte, Managing Partner of Fichte & Co Legal Consultancy.

However with only voluntary compliance, will it ever gain enough traction to make a significant impact in the industry? “Too early to tell,” says Fichte.

“It is capable of becoming mandatory if the industry allows it and becomes adopted across the board. Being based on all the relevant security initiatives, compliance with such international requirements is already an advantageous starting point for conformity with the new ISO standard. Companies have already invested significant amounts of money and time to ensure compliance with the international legislation.

“It may well be that soon every participant in the supply chain who does not comply with the certification will be left out of the market as 1) there will be higher costs for supplying a substandard service and 2) competition,” says Fichte.

ISO 28000 is applicable to all sizes of organizations wishing to conform to the highest international standard whether they are small or multinational, in manufacturing, service, storage or transportation and at any stage of production or supply. Compliance involves a systematic approach dealing in Security Management Policy, Security Planning, Implementation and Operation, Checking and Corrective Action, Management Review and Continual Improvement

Previous international regulatory requirements have not been as thorough or all-encompassing as ISO 28000, though they are each complemented by the new measure. International Ship and Port Facility Security Code (ISPS), Customs-Trade Protection Against Terrorism (C-TPAT), Technical Asset Protection Association (TAPA), Container Security Initiative (CSI), will all remain in effect, inevitably falling under the umbrella of ISO 28000. As communications and technology improve, so too must the standards that safeguard the industry.

“Modern transport and logistics concepts have ensured that even highly complex national and international transport chains are operating more and more effectively and efficiently. As part of this, it is becoming increasingly crucial that the partners along the supply chain are closely interconnected. If one supplier fails, the whole supply chain may break. This is why risks such as theft, damage, smuggling, terrorism and others require systematic protection,” says Ashraf el Sherbiny, Country Office Manager of UAE for Germanischer Lloyd.

“A specific and certified risk management system based on a uniform security standard is an important step for any company wishing to be considered as a reliable business partner for transporting goods. To ensure that, certification remains a crucial factor,” said el Sherbiny.

Perhaps the hardest task will not be convincing your company how ISO 28000 could be beneficial, but rather persuading other companies to get on board as well.

“It is recommended that companies who wish to get certified according to ISO 28000 include their partners and subcontractors in their supply chain security concept, as this is the only way to guarantee a consistent, unbroken and reliable security concept for the entire transport chain,” said el Sherbiny.

To aspire for a globally secure supply chain, el Sherbiny believes the implications must be far reaching and inclusive to all parties.

“The challenge is not just container security, consolidated shipment security or bulk shipment security, neither is it the sole creation of shipping corridors. It is the ability to engage the world in a global trade, development and security solution that is good for all nations; a solution that does not favour one nation, one port, one vendor or one individual over another. The challenge is to prepare the world for the near future in which development must occur in third world nations as well.”