Efforts to combat corruption in maritime industry
Maritime anti-corruption initiatives have emerged in the last decades as a response to the growing threat of transnational corruption in the maritime domain, specifically in the shipping industry which is responsible for around 90% of world trade. In the past, paying bribes at ports to pass through customs was perceived as normal behavior, but such activities resulting in higher operational costs lead to increasingly stricter national and international anti-corruption regulations being put in place.
Initially, international conferences addressing the safety of life and prevention of collisions were the basis for anti-corruption regulation. In the second half of the 20th century, many organizations were formed, such as the International Association of Ports and Harbors, the Baltic and International Maritime Council (BIMCO), and the International Maritime Organization (IMO) - originally named Inter-Governmental Maritime Consultative Organization (IMCO) – which are still relevant actors in maritime industry governance today.
Regulatory improvements in the industry included e.g., the Port State Control system, established in the early 1980s. The purpose of the system was to enforce regulation on ship operators who bypassed previous rules by “flagging out” to commercial registries. The Port State Control officers check vessels for compliance with international standards (ratified by the home state of the vessel). Serious transgressions can lead to fees, detainment of ships and in the worst case, the loss of the entire business. In time, the level of authority granted to Port State Control officers led to corruption spreading among them, officers frequently demanding bribe in exchange for a positive report.
Two decades after the launch of the Port State Control System, in 2002, the IMO extended the ‘Safety of Life at Sea Convention of 1974 (SOLAS) with Chapter XI.2 (Special measures to enhance maritime security). Thus, the organization approved the ‘International Ship and Port Facility Security (ISPS) Code’, which increasingly helped to differentiate between maritime safety and security. The ISPS code also clearly outlines port security-related requirements and a list of recommendations to meet these for all shipping companies, port authorities and contracting governments. 
Beyond the IMO regulations, states also declared mandatory national initiatives in parallel, which bind vessels and cargos to further regulation when sailing through certain waters. The increasingly international nature of shipping and its regulations have led to private and public actors engaging in collective initiatives from the 2010's onwards, typically manifested through the Maritime Anti-Corruption Network.
Forms of Maritime Corruption.
Corruption can be defined in various ways. For example, according to the Oxford Dictionary, corruption is “dishonest or illegal behavior, especially of people in authority”. Huntington (1989) defined it somewhat differently, by describing corruption as “the behavior, exhibited by public officials which deviates from accepted norms in order to serve private aims”. These definitions are also correct for maritime corruption specifically, however, in this field corruption can be categorized in different ways – especially at ports.
Sequeira and Djankov (2014) distinguish between two types of corruption at ports: collusive and coercive corruption. Under collusive corruption, public officials and private agents share illicit transaction-generated rents, while under coercive corruption, public bureaucrats force private agents to pay additional fees to be able to gain access to public services and goods.
Maritime corruption can also be grouped according to its different forms. DiDomenico (2020) categorizes bribes and facilitation payments as the most common forms of maritime corruption, and lists other forms such as gifts, compensation, contract awards and promises to influence decision, vote or outcome.
Lastly, maritime corruption may be categorized according to various fraud scenarios, such as:
Maritime corruption as a cross-cutting, facilitating crime.
Crucially, scholars have also been pointing out how corruption is a facilitating crime to other illegal activities in the maritime domain. DiDomenico herself mentions corruption as a crime that cultivates a “toxic environment” for e.g., fraud or tax evasion, which can deter foreign investment and can halt economic growth in the given country. Individual corruption of port employees, police, custom or border agents is also seen as a key enabler to illicit trade and trafficking, as getting across border security, checks, taxes and other forms of certifications require inside (specialist) knowledge. Finally, Krause Hansen (2018) connects maritime grand corruption to a much wider scale, by suggesting that it may be entangled with illegal financing of political parties and extractive operating in areas of limited statehood.
Corruption in the shipping industry.
Elements of the maritime industry such as seaports and terminals have always been important areas of social and economic opportunities. Ports are key strategic sectors, playing key economic, internal and international security roles for both developed and developing countries. The strategic importance of ports and other maritime resources have led to the industry being criticized by Maersk, a major shipping company, as "an environment where facilitation payments and extortion are common occurrences". In the EU specifically, coastal regions and major sea ports have shown to present the highest risks of corruption. Europe's coastal borders have increasingly been subject to corruption pressure by smugglers in the past few years. In addition, border guards and local government officials are often involved in corruption schemes related to cross-border trade. Typically, in European small coastal towns, the corruption of border guards is often related to corruption in local authorities. Several ports in Europe have been identified by the Center for the Study of Democracy as having extreme vulnerability to corruption pressures:
There are several possible causes of this dangerous environment, and many point to the very nature of the shipping industry. Frequent port calls all over the world, each country with different laws and regulations, mixed with heavy bureaucracy leaves the crews of these ships exposed to abuses of power and demands for illicit payments by the port authorities and government officials. The Conference of Business Integrity listed several factors that contribute to the shipping industry's struggle with corruption:
Due to these challenges, corruption in the maritime domain lives and breathes, which cause several risks and costs to the industry as well. Vanessa C. DiDomenico (2020) summarized these risks and costs as follows:
There are also social costs to corruption such as:
These challenges and risks have led to companies and organizations calling for the establishment of a strategic framework for a more transparent and consistent port or terminal system. However, major challenge when governments or organizations attempt to implement this kind of strategic framework is the current lack of clear procedures backed up by laws as well as the discretionary power of custom officers and other port authorities. Even when there are established transparent and consistent procedures, officials have still been able to use discretion on assessing access or noncompliance fees. This is a major challenge that the companies conducting business in Nigeria have encountered. Although policies may be put into place by national authorities, individual officer non-compliance is a major issue to the extent that the National Port Authority as an organization becomes incompetent in effective management of ports. Furthermore, ship crew are fearful of reporting corruption due to the risk of being blacklisted from the industry in retaliation. One way that the National Port Authority has tried to gain some sense of control and awareness of how much corruption is really going on is the implementation of grievance mechanisms. However, only 73% of ports/terminals customers have ever actually used these grievance mechanisms. The inability for national authorities to control the issue of corruption on their own has led to an increasing number of collective action initiatives that combine private companies, regional organizations, and national/local governments as the main actors. These initiatives are typically manifested through the MACN. 
Maritime Anti-Corruption Network (MACN).
The Maritime Anti-Corruption Network can best be defined as a certifying business coalition, a coalition between competitors that arguably enhances the strongest degree of fairness between stakeholders by forcing companies to actively create a level playing field. The Maritime Anti-Corruption Network, or MACN, can best be defined as a certifying business coalition, a coalition between competitors that arguably enhances the strongest degree of fairness between stakeholders by forcing companies to actively create a level playing field. The MACN was founded by the Business for Social Responsibility (BSR) in 2011, triggered by the adoption of the U.K Bribery Act which obliged companies to have ‘adequate procedures’ in place to prevent bribery. Therefore, an official launch took place in 2012, with the first collective action implemented with the UNDP in Nigeria. A year later, the organization established its Anonymous Incident Reporting System, which was followed by sharing anti-corruption e-learning material for members and a new project in Argentina in 2014. By 2017, the MACN already had 90 members, including the industry’s most influential members. The members take up a large variety of actors in the industry, consisting of vessel owners, companies, ports and terminal operators, associations, shipping agents and others. In the following years, the organization steadily grew and launched some more collective action initiatives in Egypt, Indonesia, Ukraine and India. In 2022, the MACN set off its Global Port Integrity Platform (GPIP), which is its newest online data site, following its initial Anonymous Incident Reporting System. The data site still showcases incident data at the global level, but with GPIP, it also measures port integrity worldwide. As there is no international standard for measuring integrity in ports as of now, the MACN works closely with international organizations, civil society, academia and stakeholders in the shipping industry to develop criteria capturing the level of integrity. In about ten years, the MACN grew from zero members to more than 190 by 2022. As of 2024, MACN reported receiving 61,000 reports of corruption in over 1,000 ports across 150 countries via tips to its Anonymous Incident Reporting System.
The MACN’s governance structure is made up of a member-elected steering committee; an annual member meeting; and a secretariat that is based in Copenhagen, Denmark. The secretariat is responsible for maintaining the incident reporting form, preparatory research and coordination of activities, communication and collective action in specific regions. For members, MACN is not only beneficial for all the information shared on incidents and e-learnings, but the sheer display of the MACN logo is already a powerful mechanism to signal their anti-corruption commitments in the maritime industry.
The MACN is a self-described global business network with the mission of working towards the elimination of all forms of maritime corruption. This mission includes several goals, including raising awareness of corruption challenges; implementing anti-corruption principles; developing and sharing best practices; collaborating with governments, NGOs, and civil society to combat the root causes of corruption; and finally create a 'culture of integrity' within the entire maritime community.
MACN has established a strategy for achieving these goals that they have named "The Three Cs":
This strategy also addressed both the supply and demand side of bribery and corruption. The internal supply side of the strategy focuses on the improvement of member compliance and anti-corruption programs, the external demand side aims to tackle bribery and corruption by achieving a clearer operational environment. Thus, the MACN cooperates with stakeholders to reduce facilitation payments and demands for bribes.
This comprehensive strategy has been used for the development of several collective actions which have focused on the implementation of new standard operating procedures (SOPs), the creation of an anonymous incident reporting mechanism, and development of an integrity training toolkit. The collective action initiatives in question have taken place in Nigeria, Argentina, Egypt, Indonesia, India and Ukraine, and most recently in Bangladesh and Pakistan.
Collective Action Initiatives.
Nigeria.
The collective action initiative between the MACN and the Convention on Business Integrity, an internationally recognized NGO which specializes in West African ethics and anti-corruption, was developed in 2011 to promote integrity and good governance in Nigeria's ports. It was developed with a multi-stakeholder approach in mind, where national port authorities, members of the maritime industry and customs officers would have an opportunity to affect the area in which they worked. The focus of this initiative was to implement face-to-face integrity training, harmonize regulations, and establish grievance mechanisms for each port to offer to captains. Nigeria is recognized as one of the most challenging countries to do business because of the major risk of facilitation requests and the possibility of extortion, harassment, and threats in the case of a company refusing to pay. The initial survey taken by the MACN showed that frequent demands were made by government agencies, primarily in major ports like Lagos Apapa and Lagos Tin Can. The project was set up in collaboration of the two previously mentioned organisations and several Nigerian anti-corruption