3.8 Human Resources
3.8.1 Introduction
Business sustainability includes constructive management and development of all our resources, particularly our people who evolve with the Company and constitute its greatest asset.
This section provides an insight into the Company’s specific HR practices whereby priority is given to making the best possible use of each person’s skills within a safe work environment. The Company works hard to integrate social balance and equal opportunities whilst preserving the different cultures within its international organisation. Indeed, it is committed to being globally aware, promoting local development and operating with integrity. The Company also believes that social responsibility means investing in the well-being of its staff and maximising their opportunities for success by providing stimulating challenges, customised training and high levels of work satisfaction.
The intention of Group Human Resources (HR) is to create an environment conducive to generating positive team energy within which each staff member can contribute his/her skills and talents towards sustaining top performance and inspiring the success that yields shared rewards and recognition. The Company focuses on promoting these values throughout its Execution Centres with the underlying ambition to continue to excel in its field and shape future trends.
The Company also pursues an employment policy following the principles of equal opportunity, thereby preventing any discrimination on the basis of sex, age, race, religion, political or trade union affiliations, nationality or disability.
For reporting purposes, the global workforce is divided into two segments: Onshore Operations and Offshore Production. The workforce is hired under permanent or fixed-term contracts and can be divided by segment, employment type, region, gender, or age. The Company also identifies White Collar and Blue Collar employees.
3.8.2 Group Activities
Under the aegis of the Group HR Director (member of the Executive Committee), the HR Directors of each Execution Centre meet regularly throughout the year to share their best practices, capitalise on experiences, consolidate HR policy alignment, and follow up on Group HR projects.
The Lease Fleet HR activities, whilst constituting an integral part of the Group HR Policy, fall under the SBM-PC Execution Centre and specifically provide the adequate crew, their logistics, as well as suitable training, for the offshore activities. All data concerning these activities is reported under Worldwide Offshore Fleet.
3.8.2.1 Focus on Talent Management & Succession Planning
A series of programmes have been implemented within the framework of the Talent Management and Succession Planning process, creating the foundations on which to build future success. In 2010, an initiative called People Reviews was introduced and has been extended to all Execution Centres during the course of 2011. In addition to the long-established annual Performance Appraisal review, these recent programmes have the purpose of supporting business growth and securing key roles and competencies in line with the SBM Offshore Group Strategy.
As a subsequent step to Talent Management, the Company launched in 2011 a customised Leadership and Management Development programme (please see more detailed information in sustainable intiatives). The objective of this Programme is to build a common leadership and management culture and to reinforce these skills throughout the Company. Consequently, particular focus is lent to visionary leadership, driving results, empowerment & people development, and cross-border communication. As the highest Executive level and Senior Management have already been onboarded, it is now the intention to cascade this initiative further within the Company.
3.8.3.1 Headcount
The total headcount is based on all Company employees registered on 31 December 2011 for Onshore Operations and Offshore Production. Headcount, therefore, equals 6,220 employees with an increase of nearly 8% compared to 2010.
The Company’s workforce is distributed geographically over the locations of each of the seven Execution Centres, construction sites, shore bases and onboard the offshore fleet.
The Company's Marketing & Sales, Treasury & Group Functions (MSTG Functions) are spread over the Execution Centres, with a total of 131 employees at the end of the year 2011.
The headcount in Monaco comprises the aggregate of the following three Execution Centres: SBM-Monaco (Turnkey Systems), SBM-PC (Lease and Operate) and SBM Services (Turnkey Services).
The workforce in SBM-Monaco has increased by 16% compared to 2010 with a total of 2,238 employees. This boosted rate is in line with the level of activity at Monaco offices and on the construction sites.
The headcount at SBM-PC rose by 5.3% to 1,948 employees in 2011 compared with 1,850 employees in 2010. The new operated FPSO’s, Aseng in E-G and the Deep Panuke PFC start-up and pre-operating phases explain this trend, which is largely related to the offshore fleet personnel and the shore base staff.
This upward curve was also experienced by SBM-Services’ workforce (installation vessels included), which increased by 16% to 308 employees in 2011 compared with 266 employees in 2010, due to the increased volume of projects in these Execution Centres.
The Schiedam Execution Centre’s workforce of 628 employees slightly increased by +2% compared with the previous year figure of 616 employees. In 2011, SBM Schiedam employs 498 persons and GustoMSC 130 persons.
SBM-Houston’s staff numbers decreased by 14% to 518 employees in 2011 compared with 601 employees in 2010, thereby reflecting the delivery of 2 Rig projects managed by this Execution Centre.
In Kuala Lumpur, there was a 17% increase to attain a total workforce of 440 in 2011 compared with 377 in 2010. This increase can be attributed to the execution of large projects this year, particularly related to the FPSO Aseng and the FPSO Xikomba relocation early work.
At year end 2011, the headcount for permanent contract employees totaled 4,655 employees representing 75% of the Company workforce and the headcount for contractor staff totaled 1,565 employees representing 25% of the workforce.
The 2011 yearly average ratio of contractors to staff is 27%.The reduction of the ratio compared with the 32% of year end 2010 is explained by the fact that recruitment efforts have been directed to increasing the permanent proportion of employees in order to maintain efficiency and keep core knowledge and expertise in house.
3.8.3.2 Workforce diversity
Over the decades, with its business spreading over 6 continents, the Company has embraced the challenges offered by different environments and adapted to this cultural mosaic. This need for adaption and in-country development has generated flexibility and diversity at all levels of the Company’s workforce. Indeed, the Company has managed to turn this diversity into strength, building complementarities and synergies amongst its employees.
The Company’s policy to recruit local-based employees whilst at the same time maintaining competency requirements through training, has led to the employment of over 55 different nationalities.
In 2011, the Group is composed of 4 main populations: French, Angolan, Brazilian and Dutch followed by 3 other key populations: Malaysian, British and American. This is explained by the geographical position of the Execution Centres, construction sites and offshore production units.
3.8.3.3 Absenteeism and turnover
The average rate of absenteeism due to normal illness remains relatively steady at 2.95% in 2011 (2.6% in 2010).
Voluntary departures have been the main trigger for the Company’s slight increase in turnover rate, which has risen from 10% in 2010 to 12% in 2011 and can be related to the economic up-turn in Houston and Kuala Lumpur. Nevertheless, the percentage of turnover remains low compared to the average rate given for similar industries in Europe and the USA. This can be attributed to the Company providing a competitive equitable remuneration package, good working conditions and overall professional satisfaction to its core resource: its employees.
3.8.4.1 Equal opportunities
At SBM Offshore, employment conditions are strictly driven by the principle of equal opportunities. The salary scales are in line with a competency matrix and take into account qualifications and professional experience. The Company considers this as an attractive element of the recruitment strategy.
The offshore engineering business has long been male-dominated; however, the Company has adopted a recruitment strategy to increase the percentage of women employees, including in managerial positions, in the onshore segment over the past 15 years. This initiative has been successful to a certain degree, even though the number of graduates coming out of engineering schools and universities is still predominantly male, and this limits the gender ratio in engineering positions. Moreover, the operating crew onboard production units remains very much male as is the case for all operators in this area of business. The total percentage of female/male permanent employees from both Onshore Operations and Offshore Production was 21% women- 79% men in 2011, which is similar to the previous year.
This being said, the feminine population is indeed represented in the Management positions of the SBM Offshore Group, with 13% of these positions being held by women (onshore).
3.8.4.2 Compensation and Benefits
The compensation and benefits package offered to the Company’s personnel remains one of the major elements in employee attraction and retention.
During the annual cash remuneration review (basic salary and bonus) of the individual staff members, the key factors of local market, annual inflation and individual performance are taken into account.
Salary benchmarking analysis is performed on a regular basis in each area where the Group has a strong presence to verify the competiveness of the Company’s compensation package compared with peers in the Oil and Gas industry. The results continue to confirm that the Company’s remuneration package and associated benefits remains competitive and attractive to potential new employees.
The Employee Share Ownership Plan, which encourages employees to invest in SBM Offshore shares, remains an attractive staff benefit, thanks to a significant contribution being paid by the Company.
A Restricted and Performance Share Unit Plan is in place and constitutes the Long-Term Incentive Plan for senior managers and other high potential staff.
The Company has an attractive pension benefit system for all its employees. As a multi-national company, it operates various pension schemes depending on the country of activity. The majority are “defined-contribution” plans, with a minor portion being “defined-benefit” plans.
3.8.4.3 Employee Well-being
Conscious of the need to protect its most important asset, the Company is continuously focused on the well-being of its personnel and provides a pleasant work environment. In this respect, several initiatives have been implemented over the past few years across the Company’s Execution Centres, namely:
- stress management & healthy living presentations to Managers (Monaco, Houston & Schiedam)
- employee care officer consultations available to employees (Schiedam & Monaco)
- stop smoking campaigns in Monaco
- fitness rooms in Houston and Monaco
- organisation of social events at all locations to favor interaction throughout the organisation
- bicycle plan in Schiedam
- life cycle based personnel policy in Schiedam
- SBM Nursery: this Monaco-based professionally-run nursery and pre-school structure welcomes 33 children from 3 months to school age
This comes on top of the safe work environment that the Company considers as a priority, as described under the HSSE section.
3.8.5.1 Employees’ performance review
To ensure business continuity, personnel satisfaction and efficiency are key factors on which the Company’s Management maintains a keen focus. To help monitor those crucial indicators, the annual employee performance appraisal exercise (permanent employees) has proven to be a valuable tool. It is a long-established process at SBM Offshore and has been modernised over the years in order to take into consideration the Company’s strategic objectives and the employee’s career expectations.
All performance appraisals under Onshore Operations are made in accordance with the Company’s Competency System whereby employees are appraised against specific competencies related to their position, as well as the fulfillment of set objectives. Once again this year, emphasis has been placed on the purposeful setting of individual career development objectives, in line with the overall needs of the Company.
The intranet-based electronic performance appraisal system has now been implemented in all Execution Centres. The tool has proven to be highly beneficial to the process; it enables the punctual tracking of the completion progress, and provides statistics for reporting, training and development purposes.
The annual performance reviews are one of the sources of valuable information for the Talent Management and Succession Planning processes.
Offshore Production appraisals are performed for all permanent and contract employees working onboard the production units. All employees are appraised in direct compliance with the offshore work activities and the assessments cover the fields of safety, teamwork and professional competence. This exercise is done via SBM Offshore HR crew management system.
The performance appraisal completion rate remained stable this year at 95%,confirming overall awareness of the great importance of this exercise.
3.8.5.2 Training and development
Development of competencies of employees through general and specific programmes is crucial to the Company’s business continuity and changing environment. It is also a necessity for employees to be able to picture themselves as part of the Company’s future.
The Company provides a range of training and development opportunities to enhance the skills of its employees worldwide. The total training hours recorded for 2011 is close to 133,000 and averages 29 hours of courses per person. In comparison with 2010 figures (excluding the Paenal Yard specific training programme), 2011 total training hours have increased by 5.3% and number of hours per employee increased by 4.3%.
3.8.5.2.1 White Collar Staff
Training is based on the Company’s objectives. The need for training is discussed during the annual Performance Appraisal session and a training plan is developed for execution during the following year. The actual results are closely analysed to identify areas for improvement.
Training covers both in-house training, which is performed by Company staff or consultants, and external training, which is performed outside the Company’s work centres by specialised training providers.
Training during 2011 was mainly technical and safety-related, followed by managerial-leadership training thanks to increased efforts to focus on this area. Attendance at conferences and seminars remained high on the agenda, indicating the continued desire to remain in touch with new developments in specific fields of study. Language lessons and computer software trainings were also well attended.
Internal training for management continues with the now long-established SBM-Schiedam Management School. Its programme focuses on specific development trainings with a target group of staff who are envisaged to have lead, supervisory or managerial positions in the future. For the 2011 session, 15 participants from the Schiedam and Monaco offices attended the programme, with a total amount of 1,410 hours of customised courses.
As a complementary approach to training and development, student internship programmes continue to function well and enable judiciously-selected graduates to obtain their first work experience in the Company and, in many cases, successful employment.
3.8.5.2.2 Blue Collar Staff
Given the significant technical and safety requirements of the operations onboard the production units and work at construction yards, the Company considers on-the-job training and external courses to be of utmost importance for all its personnel, whether permanent or contractor.
This principle applies not only to long-standing crew and technicians but also to the additional workforce available locally, which needs to familiarize itself with the specifics of the Company’s activities. To meet this need, the Company supports nationalisation programmes, namely in Brazil, Angola & Malaysia.
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