Section 15.4 Internal Audits, Non-Conformities, and Continuous Improvement
The International Safety Management (ISM) Code is not designed to be a static set of rules, but rather a dynamic framework for ongoing safety and environmental protection. Key to its dynamism are the processes of internal auditing, the diligent reporting and analysis of non-conformities, accidents, and hazardous occurrences, and an overarching commitment to continuous improvement. These elements form the critical feedback loop (the “Check” and “Act” stages of the Plan-Do-Check-Act cycle) that allows a shipping company and its vessels to learn from experience, identify weaknesses in the Safety Management System (SMS), and systematically enhance safety performance over time. For the Master of a bulk carrier, fostering an environment where these processes are embraced openly and effectively is crucial for maintaining a robust safety culture and ensuring the long-term viability of the SMS.
1. Internal Audits (ISM Code, Section 12.1):
The ISM Code requires the Company to carry out internal safety audits to verify whether safety and pollution-prevention activities comply with the SMS.
A. Purpose of Internal Audits:
Verify Compliance: To systematically and independently examine whether the documented procedures and instructions within the SMS are being effectively implemented onboard and ashore.
Assess Effectiveness: To evaluate whether the SMS itself is effective in achieving the Code’s objectives (safety at sea, prevention of injury/loss of life, avoidance of damage to environment/property).
Identify Non-Conformities and Observations: To uncover areas where practice deviates from documented procedures (non-conformities) or where potential improvements could be made (observations).
Promote Continuous Improvement: To provide feedback that can be used to correct deficiencies and enhance the overall safety management system.
Prepare for External Audits: Regular internal audits help ensure the vessel and company are well-prepared for mandatory external audits by the Flag State or Recognized Organization (for DOC and SMC certification).
B. Who Conducts Internal Audits?
Company Personnel: Often conducted by designated auditors from the company’s shore-based management (e.g., DPA, safety/quality department personnel, superintendents).
Independence: Auditors should be independent of the areas being audited, meaning they should not audit their own work or areas where they have direct responsibility, to ensure objectivity.
Training and Qualification: Auditors must be properly trained in auditing techniques and have a good understanding of the ISM Code and the company’s SMS.
C. Frequency and Scope:
Frequency: The ISM Code requires periodic internal audits. The company’s SMS will define the audit schedule. Typically, each ship is audited internally at least annually, and shore-based offices are also subject to internal audits.
Scope: Internal audits should cover all aspects of the SMS relevant to the area being audited. This includes:
Review of documentation and records (logbooks, checklists, permits, maintenance records, training records, NCRs, etc.).
Interviews with personnel to assess their understanding and implementation of procedures.
Observation of work practices and operational activities.
Inspection of equipment condition and safety arrangements.
D. The Internal Audit Process Onboard:
Planning: The auditor plans the audit, often using an audit checklist based on the SMS and ISM Code. The Master and relevant department heads are usually notified in advance.
Opening Meeting: The auditor meets with the Master and senior officers to explain the scope, objectives, and methodology of the audit.
Conducting the Audit: The auditor gathers evidence through document review, interviews, and observations. Ship’s staff should cooperate fully and provide access to all necessary information and areas.
Identifying Findings: The auditor identifies any non-conformities (NCs), observations (OBS – areas for improvement or potential future non-conformities), or good practices.
Closing Meeting: The auditor discusses the findings with the Master and senior officers. This is an opportunity for clarification and agreement on the findings.
Audit Report: The auditor prepares a formal report detailing the scope, findings (NCs, OBS), and any positive aspects. This report is submitted to company management and a copy is usually left with the Master.
E. Master’s Role During an Internal Audit:
Preparation: Ensure all relevant documentation is up-to-date and accessible. Brief the crew on the upcoming audit and encourage open and honest participation.
Facilitation: Provide the auditor with necessary assistance, access, and information.
Active Participation: Attend opening and closing meetings. Engage constructively with the auditor regarding findings.
Follow-up: Ensure that corrective actions for any identified non-conformities are planned and implemented effectively within the agreed timeframe.
2. Non-Conformities (NCs), Accidents, and Hazardous Occurrences (ISM Code, Section 9):
The ISM Code requires the SMS to include procedures ensuring that non-conformities, accidents, and hazardous situations are reported to the Company, investigated, and analyzed with the objective of improving safety and pollution prevention.
A. Definitions:
Non-Conformity (NC): An observed situation where objective evidence indicates the non-fulfillment of a specified requirement of the SMS, the ISM Code, or other applicable regulations. (e.g., a required checklist not being used, maintenance not done as per PMS, a safety device found inoperative).
Accident: An undesired event giving rise to death, ill health, injury, damage, or other loss.
Hazardous Occurrence (Near Miss / Dangerous Occurrence): An event or sequence of events that, while not resulting in an accident, had the potential to do so. Reporting and analyzing near misses is crucial for proactive safety management, as they often highlight underlying system weaknesses before an actual accident occurs.
B. Reporting System:
The SMS must have a clear and simple system for all personnel to report NCs, accidents, and hazardous occurrences without fear of blame (a “no-blame” or “just culture” reporting environment is encouraged, focusing on system improvement rather than individual punishment, unless there is willful negligence or violation).
Standardized reporting forms are usually provided.
Reports should be submitted to the designated person(s) onboard (e.g., Safety Officer, department head, Master) and to the Company (DPA).
C. Investigation and Analysis:
All reported NCs, accidents, and significant hazardous occurrences must be investigated to determine:
The immediate cause(s).
The underlying root cause(s) (e.g., inadequate procedures, insufficient training, equipment failure, poor communication, human factors).
The level of investigation should be proportionate to the actual or potential severity of the event.
The aim is to learn lessons and prevent recurrence, not to assign blame.
D. Corrective Action:
Based on the investigation, appropriate corrective action must be taken to address the identified cause(s) and prevent the event from happening again.
Corrective actions should be:
Specific and targeted at the root cause.
Assigned to a responsible person.
Given a realistic deadline for completion.
Documented.
E. Preventive Action:
Beyond correcting immediate issues, the analysis of NCs, accidents, and hazardous occurrences should also identify opportunities for preventive action – steps taken to eliminate the causes of potential non-conformities or undesirable situations to prevent them from ever occurring.
F. Master’s Role:
Foster a Reporting Culture: Encourage all crew to report openly and honestly. Lead by example.
Ensure Timely Reporting: Verify that all events are reported as per SMS procedures.
Lead or Oversee Investigations Onboard: For incidents occurring on the ship, the Master often leads or directly supervises the investigation.
Implement Corrective Actions: Ensure that agreed corrective actions are implemented effectively and their effectiveness is verified.
Communicate Lessons Learned: Share lessons learned from incidents with the crew to raise awareness and prevent recurrence.
3. Continuous Improvement (ISM Code, Section 1.2.2.2 & Section 12):
Continuous improvement is a fundamental tenet of the ISM Code. The SMS is not intended to be perfect from day one but should evolve and improve over time based on experience, feedback, and changing circumstances.
A. Mechanisms for Continuous Improvement:
Analysis of NCs, Accidents, and Hazardous Occurrences: Identifying trends and systemic weaknesses.
Internal Audit Findings: Highlighting areas for improvement in procedures or implementation.
External Audit Findings: Similar to internal audits.
Master’s Review of the SMS (ISM Code, Section 5.1.5): The Master is required to periodically review the SMS as implemented on their ship and report any deficiencies or suggestions for improvement to the shore-based management. This is a vital feedback loop from the “sharp end.”
Company Review of the SMS (ISM Code, Section 12.2): The Company should periodically evaluate the efficiency of the SMS and review it in light of audit reports, Master’s reviews, changing regulations, and other relevant information.
Safety Meetings Onboard: Regular safety meetings provide a forum for crew to discuss safety issues, suggest improvements, and review recent incidents or drills.
Feedback from Crew: Creating channels for all crew members to provide suggestions for improving safety or the SMS.
Benchmarking and Best Practices: Learning from industry best practices, alerts from P&I Clubs, accident investigation reports from other companies/Flag States.
B. The Plan-Do-Check-Act (PDCA) Cycle: This iterative four-step management method is central to continuous improvement under ISM:
PLAN: Establish objectives and processes necessary to deliver results in accordance with the safety and environmental protection policy (e.g., develop a new procedure, set a safety target).
DO: Implement the process or procedure.
CHECK: Monitor and measure processes and results against policies, objectives, and requirements, and report the results (e.g., through audits, incident reports, performance indicators).
ACT: Take actions to continually improve process performance (e.g., implement corrective actions, revise procedures, provide more training). The cycle then repeats.
C. Master’s Role in Driving Continuous Improvement Onboard:
Lead by Example: Show a personal commitment to looking for better and safer ways of working.
Encourage Participation: Actively solicit feedback and suggestions from all crew members regarding safety and the SMS. Make safety meetings meaningful and interactive.
Facilitate the Master’s Review: Conduct thorough and honest reviews of the SMS implementation on their vessel and provide well-reasoned feedback and recommendations to the Company.
Follow Through on Improvements: Ensure that agreed improvements or corrective actions are actually implemented and their effectiveness is monitored.
Celebrate Successes: Acknowledge and reinforce positive safety behaviors and successful implementation of improvements.
Analysis for the Master (Audits, NCs, Continuous Improvement): These elements transform the SMS from a set of documents into a dynamic, learning system.
View Audits as Opportunities: Internal (and external) audits should be seen as valuable opportunities to identify weaknesses and improve, not as threats or fault-finding exercises.
Embrace “No-Blame” Reporting: A culture where crew feel safe to report errors and near misses is essential for identifying hidden risks before they lead to accidents. Focus on system failures, not just individual errors (unless willful violation).
Ownership of the SMS Onboard: The Master and senior officers must take ownership of the SMS on their vessel, actively using it, reviewing it, and contributing to its improvement, rather than just passively complying.
Patience and Persistence: Continuous improvement is a long-term commitment, not a one-off project. It requires sustained effort and attention.
The ISM Code’s emphasis on internal audits, robust management of non-conformities, and a commitment to continuous improvement provides the mechanisms for a shipping company and its vessels to learn, adapt, and progressively enhance their safety and environmental performance. The Master’s active leadership in these processes onboard is fundamental to transforming the ISM Code from a regulatory burden into a powerful tool for achieving operational excellence and a deeply ingrained safety culture.