Operational Guide · Registers & Logbooks

# Contractor and External Supplier Management

2026 brings a stricter audit environment, with Classification Societies demanding documented evidence rather than simple declarations of compliance: the qualification and monitoring of external suppliers is no exception.

contractor management external suppliers procurement SMS

## Operational Explanation

The ISM Code requires the Company to establish procedures for key shipboard operations relating to safety and environmental protection, with duties defined, assigned to qualified personnel and documented: this principle extends to contractors and external suppliers (shipyards, technical service providers, equipment suppliers, catering agencies, security) who work on board or provide services critical to the ship.

Structured contractor management requires prior qualification of the supplier, a clear definition of the scope of work, supervision of the activities carried out on board and, where relevant, integration of the supplier's procedures with those of the ship's Safety Management System.

## Regulatory Reference

The ISM Code does not explicitly govern contractor management in a single article, but requires it implicitly through the general requirements on documented procedures for key operations and on risk identification/management; the 2026 audit environment requires documented evidence of this management, not simple declarations of compliance.

## Scope of Application

Every Company using contractors or external suppliers for services on board or in support of the ship, with the DPA responsible for ensuring that the qualification and monitoring of these suppliers is documented and verifiable.

## Procedure / How to Complete It

1. Qualify every supplier/contractor before engagement, verifying references, certifications and safety track record relevant to the service provided.
2. Define the contractor's scope of work in writing, including the safety responsibilities applicable during execution on board.
3. Integrate the external supplier's procedures with those of the ship's Safety Management System, particularly for high-risk activities (hot work, confined space entry).
4. Actively supervise contractors' activities on board, not just rely on a prior document check.
5. Document the supplier's performance at the end of the assignment, to inform future engagement decisions.

## Practical Example

Example: before maintenance work by an external technical supplier requiring hot work near fuel tanks, the Company verifies the supplier's personnel certifications, integrates its safety procedures with the ship's Permit to Work System, and designates an on-board person responsible for direct supervision of the work.

## Real Cases

The 2026 audit environment of Classification Societies, which now requires documented evidence rather than asserted declarations of compliance, has made visible a widespread gap in contractor management: many Companies qualify suppliers only informally, without a written and verifiable procedure, exposing themselves to major non-conformities when the auditor requests documentary evidence of qualification and actual supervision.

## Common Mistakes Mistake Library

Mistake | Consequence | How to avoid it
--- | --- | ---
Supplier/contractor engaged without a documented, verifiable qualification procedure | Major non-conformity in audit when evidence of qualification is requested, not just the assertion of having carried it out | Formalise a written supplier qualification procedure, with documentary evidence kept for every engagement
Contractor's scope of work not defined in writing, with implicit or assumed safety responsibilities | Ambiguity over safety responsibilities during work execution on board | Always define the scope of work and specific safety responsibilities in writing before work begins
Contractor activities on board not actively supervised, relying solely on prior supplier qualification | Operational risks not detected during actual execution of the work | Maintain active supervision of contractor activities on board, especially for high-risk work

## PSC Observations

Contractor management is not typically subject to direct PSC verification, but its shortcomings can emerge indirectly through deficiencies linked to work performed by third parties (e.g. non-compliant work permits, non-compliant equipment installed by an external supplier).

## Operational Tips

- Do not rely on informal supplier qualification: always formalise the procedure in writing, with documentary evidence kept.
- Always integrate the contractor's safety procedures with the ship's own (Permit to Work, confined space entry), don't treat them as parallel, separate systems.
- Document every supplier's performance at the end of the assignment: this information is valuable for future engagement decisions and for audit evidence.

## Checklist

- Supplier/contractor qualification procedure formalised in writing
- Scope of work and safety responsibilities defined in writing before work begins
- Supplier procedures integrated with the ship's SMS for high-risk activities
- Active supervision of contractor activities on board documented
- Supplier performance documented at the end of the assignment

## FAQ

Does the ISM Code explicitly require a contractor management procedure?
Not under this specific name in a single article, but it requires it implicitly through the general requirements on documented procedures for key operations and on-board risk management.
Why does the 2026 audit environment make contractor management more critical?
Because Classification Societies now require documented evidence of compliance, not simple asserted declarations: a purely informal supplier qualification risks generating a major non-conformity when verifiable evidence is requested.
How are an external supplier's procedures integrated with the ship's SMS?
By defining the scope of work and safety responsibilities in writing, and explicitly linking the supplier's activities to the ship's existing procedures (e.g. the Permit to Work System) for high-risk activities such as hot work or confined space entry.
🎬 Additional photos, videos and interactive diagrams for this topic will be available in a future version of the platform.

## Related Topics

Permit to Work System Designated Person Ashore (DPA)

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