The Daily View: We can’t all be above average
THE “average” shipowner owns about five and a half ships.
That’s an important figure to keep in mind when listening to the parade of experts who tend to talk confidently about trends in shipping.
There is no singular industry, only a loosely related series of sectors.
The big brands that are recognisable even outside of the sector bear no relation to the three-ship operations struggling to keep things afloat on a daily basis.
That is not a value judgement; many small operators in shipping set the gold standard in quality. It is simply an acknowledgement that small- to medium-sized companies struggle with the increasing complexity of what it means to be a ship operator today.
The fact that 60% of the industry missed the initial emissions reporting deadline in the EU ETS does not mean that a crisis is looming yet. This was, after all, only the first in a long schedule of deadlines and requirements for owners to hit and, while fines are now inevitable for some, most will struggle through.
Shipping tends to have an affinity with journalists when it comes to deadlines, but they both tend to get there in the end.
It is, however, indicative of a wider problem that the average shipping company faces. Namely, that it is increasingly difficult to be a small shipowner.
The increased volume of carbon accounting alone is demanding more than most small companies can manage, but add in finance, safety, security, risk and compliance demands and it quickly creates a “to do” list beyond the capacity of your average overworked chief financial officer.
Lloyd’s List’s recent survey found that 60% of you were not equipped with sufficient technical expertise to navigate regulatory compliance over the next five years.
The problem with such surveys is that Lloyd’s List subscribers tend to be a self-selecting crowd of more sizable businesses, staffed by people who are fully across all aspects of regulatory complexity.
If we were somehow able to reach a more representative demographic of “average” owners, that figure would likely have been significantly higher.
The “above average” owners we talk to daily are hiring regulatory specialists internally or tooling up with partners to deal with the incoming issues. But not everyone has that luxury.
Sensible readers should be wary of experts talking confidently about such trends in shipping, and they would be right to point out that in a more regulated market, agility and smart partnerships may allow smaller players to outpace larger, slower-moving competitors.
But generally speaking, it remains the case that complexity is making it more and more difficult to be average in shipping.
Richard Meade
Editor-in-chief, Lloyd’s List
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