Carnival Corp. has agreed to pay $20 million in an environmental violations case to avoid having its probation revoked. The deal with federal prosecutors also contains several new environmental initiatives.
The agreement was unveiled in court in Miami before U.S. District Court judge Patricia Seitz, who had required Carnival Corp. chairman Micky Arison and CEO Arnold Donald to attend the hearing.
As part of the agreement, Donald will issue a statement to all employees accepting management responsibility for probation violations committed since the company originally pleaded guilty to environmental crimes.
Following the court hearing, Carnival asserted in an email to Travel Weekly that it was not only committed to the compliance terms imposed by the court in its settlement but that it aspired to "leave the places we touch even better than when we first arrived."
"Today, the court approved our agreement with the Department of Justice, setting forth new initiatives, improved procedures, additional training and significant investments to ensure we have the strongest and most sustainable environmental compliance program possible," the email stated. "Carnival Corp. remains committed to environmental excellence and protecting the environment in which we live, work and travel."
Carnival had previously paid a $40 million penalty and agreed to five years of court-supervised environmental audits as part of its plea to 2016 charges that Princess Cruises violated pollution laws.
Donald's statement will be issued within 30 days of the June 3 agreement and will be approved by prosecutors and the court before distribution.
As part of the agreement, Princess also acknowledged new violations of laws banning the dumping of "gray water" in prohibited places and allowing plastic mixed in with food waste to be dumped overboard.
Several countries, such as the Bahamas, first learned that improper discharges had been made in their waters by reading court filings made by auditors in the Princess case. This week's agreement includes a new obligation by Carnival Corp. brands to inform jurisdictions when violations of international pollution treaties take place.
Carnival agreed to spend at least $20 million through the end of its probation term to improve food waste management and disposal practices.
To that end, Carnival agreed to create two "tiger teams" of five to seven people each that will jump-start the improvement process. The agreement sets out a three-part program that includes improvements in training, supervision, staffing and the culture surrounding food disposal at Carnival.
It also mandates a 50% reduction in single-use plastics on Carnival ships by the end of 2021 along with strategies to reduce the weight of food waste by 10%.
Single-use plastics go beyond straws and stirrers to include items such as condiment packets, utensils, plastic bags in retail shops, individual-use toiletry bottles, garbage bags in cabins and cup lids.
The agreement also commits Carnival to a detailed overhaul of the way it manages compliance with environmental laws.
To start, it will promote a corporate compliance manager to be a senior vice president, then name a chief compliance officer to whom the compliance manager will report. The chief compliance officer will report directly to Donald and indirectly to two board committees.
The board will be required to undertake compliance training and adopt a new statement reiterating its commitment to compliance. A new member will be added to the board who has "significant corporate compliance experience."
Carnival agreed to develop an action plan for compliance and take other steps by certain dates to avoid facing severe financial penalties. Fines would start at $1 million a day for each day beyond the deadlines and in one instance escalate to $10 million a day after 10 days of failing to comply.