Moving Energy Forward

Case Studies

Home Media Case Studies

The Evolution of Compliance Training

The Evolution of Compliance Training

From September to the end of each year, Gunvor’s Compliance Team undertakes its annual mandatory employee training and review for all relevant employees. More than 800 individuals participated in the courses in 2021, representing 100% of those who require such training. 

While each year, the rhythm of this exercise is the same—four months of updates and reviews for existing employees—during the eight intervening months, Gunvor’s Compliance team works hard to continuously evolve their presentations and train new joiners. The world of Compliance is ever evolving, so must our approach to it. 

Across the world, governments and regulatory bodies are forever refining and adjusting how they treat various aspects of commodities trading—a global business that operates across many various sectors, industries, and jurisdictions, not to mention myriad customs and cultures. While the basic rules do not change, there are always new areas to cover. 

The physical and financial energy traded markets are subject to regulatory oversight from many different organisations. The main oil futures contracts are heavily traded on ICE and CME by a variety of different participants, including the oil majors, trading houses, and hedge funds. Paper or physical trading of natural gas, power, or LNG in the European Union or United Kingdom may require potential licensing and notification requirements. Biofuel trading requires sourcing oversight in certain Asian jurisdictions. Our European oil refineries further have their own strict regulations. 

Therefore, a great deal of preparation is undertaken to collect the latest, most relevant Compliance examples, such as updates to sanctions, market rules, and relevant case law. All industries regularly see new examples of companies under the spotlight for non-compliance with applicable laws and regulations. We look at the latest fines and penalties, as well as the positive outcomes. More nuanced even is keeping track of the changes in market expectations. Our team holds regular discussions with all our relevant stakeholders, including governments and NGOS, industry working groups, our partners, and our banks. 

There is further a great deal of debate within the Compliance Team about what examples to use for our employees. The challenge is to find the right balance between showing the effects of what happens when the rules are not followed, while not overwhelming in such a way to be counterproductive. Our imperative is to demonstrate what the risk really is for the company and for individuals, when there are breaches of policies and values. It is not about saying the same thing the same ways every time. 

Training consists of 90-minute, face-to-face meetings, which can be of more than a dozen people, if they are back-office staff, or just a handful, if the group consists of traders or operators. As a result of the practical impacts of the pandemic, we have enhanced our online training tools and video conferencing options; however, employees are followed up in person, and every new trader hired by Gunvor must meet in person with our Compliance Team. 

We feature several senior speakers, including the Head of Advisory Compliance and Head of Anti-Bribery & Corruption, as well as regional compliance voices from areas like Singapore and Houston. With the Compliance team growing to almost 20 staff members worldwide, we can share many viewpoints—which are encouraged. 

Our training sessions are Socratic in nature, usually entailing lively debate and discussion. These sessions get into the nitty gritty of topics with lively conversation—from details about what is required for the Know Your Customer (KYC) process, or about structuring joint ventures, or the company’s policy to not use agents for business origination. The goal is to ensure every participant is actively engaged. We can see the results. 

In 2021, Gunvor’s Global Head of HSEC presented a new training on Human Rights assessment and the relevance of the topic for Gunvor. The Compliance team itself had already been specifically trained on Human Rights, and now we have expanded company-wide. Even before implementation of the Human Rights module, Gunvor has stopped working with or not reactivated certain counterparties as result of their Human Rights infringements, including allegations related to child labor, or environmental issues, as with palm oil, which impacts local communities. 

The never-ending process of Compliance training may seem daunting, but what underpins Gunvor’s approach is the Golden Rule of “speaking up,” so that all employees know that the Compliance team is open and available to them for any questions—and that is why Gunvor Compliance is seated in the middle of open spaces with the traders and other back-office functions. It is about building a culture of understanding, for the betterment of our employees and our business. 

Topics Covered in Gunvor’s Annual Mandatory Compliance Training

  • Code of Conduct & Ethics
  • Anti-Money Laundering
  • Golden Rules of “Know Your Customer” 
  • Counterparty Management System
  • Anti-Bribery & Corruption (with a focus on third-party risk)
  • Gifts & Entertainment
  • Sanctions, Vessel screening
  • Conflicts of Interest
  • Market Conduct
  • Information Barriers & Insider Trading
  • Communications 
  • Internal Controls
  • Escalation
  • Whistleblowing & Non-retaliation
  • Human Rights