DNV GL: A Forward-Looking Merger Focused on Innovation
By Martin Edwin Andersen
DNV GL is celebrating its 150th anniversary and the first year of its merger by laying claim to even greater innovation in areas as different as sustainability and expertise in maritime, oil, gas and energy. The company is now the world’s largest ship and offshore classification society, the leading technical advisor to the global oil and gas industry, and a leading expert on renewables and energy efficiency. It is also one of the top three certification bodies in the world.
Recently veteran journalist Martin Edwin Andersen spoke with Paal Johansen, Vice President and Regional Manager, Maritime Americas, at DNV GL, about the newly merged entity and its expanding role within the classification society community. Here are excerpts from that conversation:
MEA: In 2013 the Maritime Labor Convention of 2006 went into effect. How do you think its application is working?
PJ: In 2006 the convention was still in a partially raw format, and there was a long way until ratification. So we started early to make sure we were prepared for what was coming. I can remember when I was working in Florida we were preparing our surveyors and putting together the training materials to guide our clients – shipowners and operators – and preparing the market as well. Due to this early engagement we were in position to introduce verification before it came into force.
MEA: That dry run must have helped you get rid of problems even before the convention went into force.
PJ: The compliance verification helped shipowners and operators know if they were in good shape. In some cases we were even able to issue compliance certificates.
MEA: How did you get the necessary cooperation to make the dry run work?
PJ: The question was getting the dry run to work for the owners and operators. We were ready to discuss and clarify the requirements, which had an impact on many issues – on design, but also on operations. In a way it was putting the old ILO requirements into one new ruling. So it was more the need to guide owners and operators on how to deal with, or interpret, the requirements. When they were ready, we would go onboard to do a check, according to the regulations.
MEA: The merger of your two companies made a big splash when it happened. How are things working out?
PJ: There have been a lot of good and positive developments. We’ve completed some cross-training of surveyors and auditors from the two companies, which means we are able to utilize resources more efficiently to cover the entire fleet worldwide. So there are a lot of positive developments. But of course there are challenges on the systems side because we are going to be on similar platforms when it comes to IT, and this is a process that takes time.
MEA: One might think that the combination of the two companies is greater than the individual parts when it comes to services. What are you able to do that you wouldn’t have been able to do if you were two separate companies?
PJ: That’s a good question. The network and capacity have expanded, meaning we have greater reach. We have also joined forces in specific ship segments. For example, although we had a lot of expertise on the container side, GL was the biggest in volume and regarded as the top player. What you see now by joining forces is the reach to clients and the market has been an upside.
Technology development is an area where we also see a lot of gains for us together. Traditionally, both DNV and GL were spending about five percent of annual revenue on strategic research and development into new technologies. Along with that came a forwarding-looking view on everything that promised to give an advantage to the shipping industry. These are areas in which we have also expanded, both in proper funding but also when it comes to being able to handle more projects.
MEA: Given the challenge to retain and expand market share, how has this merger been helpful?
PJ: The intent of the merger has never been to increase volume and market share. The intent is to be able to reach wider and longer with our different capabilities, with an overall aim of improving our services.
MEA: One of the cutting-edge problems these days is cyber security, and the vulnerability of computer networks seems to suggest that much more needs to be done in terms of secured communications infrastructure. Vulnerability assessments are obviously a key to that. What is DNV GL doing to promote cyber security awareness?
PJ: That topic is part of a new report we just issued, The Future of Shipping, where we take a broad view out to 2050. The report looks at being able to handle data from ships, which can help operators with energy efficiency and other key issues. Anything on the Internet can be hacked, and there is the risk of being exposed to forces that you would not like to see on the seven seas. We are already involved in certifying companies according to ISO standards on IT security. There is an ISO standard for the land-based industry, and we do a lot of that kind of certification.
When it comes to cybersecurity, it becomes a critical safety issue. Imagine the possibility of somebody taking control of a ship via the Internet. We have addressed this in what we call “the connected ship.”
MEA: What do you think is the one fundamental challenge of the next decade for the industry?
PJ: For the industry in general it is being on top of, or ahead of, technological change. We must ensure that people in the industry are educated and trained to be able to handle the new technology. It’s a continuous challenge. You see it consistently, and we need to make sure we can update our systems and methodology and everything else in line with new technology.
MEA: Another area getting a lot of attention these days is emissions with UN targets on carbon and more focus on alternative fuels. In what areas is DNV GL providing leadership and cutting-edge technological initiatives?
PJ: I can proudly say that DNV GL has provided leadership and cutting-edge technological initiatives when it comes to LNG as fuel. We are involved in the whole value chain and have worked on many levels to make it a viable technology. We led an ISO committee on LNG bunkering and made it applicable to the industry through a Recommended Practice. We have issued a Recommended Practice on training of crew. We classed the first LNG-fueled vessels and still the majority of sailing vessels. We advise ports and shipping companies worldwide on risk management, and we work with governments and the IMO on how to make LNG feasible sooner.
The UN targets are something the whole industry is facing. The marine industry is not the worst polluter relative to transported cargo volumes, being some three percent of global transport in totality, but it will have to take responsibility for their part of the pie and do something about it. You will see continuously more focus on alternative fuels that are more environmentally friendly. You see that with LNG, biofuels – I would not be surprised to see nuclear-powered ships in 10 to 20 years.
MEA: On the work of the IMO Subcommittee on Flag State Implementation (FSI) and its new code for recognized organizations (ROs), what do you think about the consolidated instrument? How do you think that is going?
PJ: I think it is right. The flag states should have an overview of the ROs, and
we have been audited every year by the ROs in particular countries. They have delegated work to us, but they are responsible for the requirements and also the enforcement of the requirements. – MarEx