March 2010 Article

The Rise of the British Private Security Company 

Published by: RUSI Newsbrief March 2011

Authour: William Dill

The context of any modern seminar which focuses on the way forward in current international conflict zones is never wholly detached from the relevance of questions surrounding the role and potential of private security firms.  In some instances, the question is delicately discussed for a number of minutes but not actually answered.  This demonstrates to a large extent the level of awareness and uncertainty which exists both in the business world and amongst academics in relation to the ethical use of Private Security Companies (PSCs). There is even perhaps a temptation to leave the thorny issue unresolved, in the hope that it might all go away.

The fact remains however that as a provider, the PSC is here to stay and unresolved issues will inevitably affect the effective support of our armed forces and thereby diminish the planning, response, implementation and support to NGOs and British business development internationally, as well as impeding the effectiveness of human rights organisations, charities and the British press in countries where they are most needed. 

PSCs in the 21^st century are currently providing an essential specialist service, which in many cases our UK Armed Forces are not well enough resourced or structured to carry out. Nevertheless, the public image of the PSC operative remains in some instances that of a Mercenary or a gun for hire, who by the nature of their work must be comparable to a tiger on a leash?

The authors have previously discussed the proposed Military, Accountability, Conduct and Engagement standard (MACE – see RUSI December 10 issue). This standard is primarily designed to help formulate the requirements of the International Code of Conduct. However, that is not all that it can be and in effect there are considerable opportunities. The standard is designed around proving that those companies that attain it are:

• Specialists that deliver a professional service, based on intrinsic skills, providing a much needed resource to Governments, NGOs, International Organisations and Human Rights Organisations.

• Managing an element within the supply chain that ensures that adequate skills and resources and effective risk management are relevantly and professionally applied where and when required.

• A legitimate and noteworthy career path for ex service personnel with the relevant skills and experience.

The Implications of MACE

We therefore have a new industry. It is neither manufacturing nor (in its very basic terms) can it be wholly analogous to service. It is unique. Indeed, there are few historical precedents with which we can associate this change in the organised use of proscribed force.

To this end, we must be clear what regulation actually means. Do we mean ‘handicapping’ a private security company with so much paperwork, auditing and regulation that it can not function or can operate only with security concerns or do we strive to allow the company to operate legally, while still able to fulfil its contracts, no matter how unwholesome they might be? No matter what the contract, police action, or indeed war, there are implications for professionalism, training and reliability of an oversight body and standard, that affects the whole industry, perhaps more so than any other.

It is clear that we are not dealing with mercenaries. A look at how these companies conduct themselves (in the main) makes that clear and by their very function also highlights the need to classify their activities in conjunction with international ‘state’ military units.

MACE therefore strives to operate in tandem with the Code of Conduct and promote a functionary, legitimate manner of auditing those companies who strive toward excellence in the field in terms of their operation, training, conduct and transparency.

It is our belief that the Code of Conduct is simply that; a code by which international law can be recognised, but one can not audit against a code, only a standard. That same standard should make clear what systems should be in place, yet not dictate their layout or design.

In operational terms, the standard is strategic rather than tactical. It will advise ‘when’ a system should be adopted without specifying ‘how’. No standard could possibly do that since it would be impractical to cover each and every operational environment and security based circumstance. Indeed, such an attempt would be so detailed and onerous that it would preclude sensible use. Operational techniques and principles would dictate the ‘how’ with regard to handling of prisoners for instance, yet the fact that such a procedure must exist and the reasons for it, would be handled via MACE and the International Code of Conduct respectively..

MACE would outline those principles which should be in use while the contractor would make their system fit current operations. The MACE auditor would satisfy him/herself with regard to the availability and applicability of the system.

For example, the standard would state that a central operations hub should be in place to manage patrol and operational activity. It would not describe the organisation of personnel, only that there should be clear delineation with regard to command structure.

The standard would state that personnel should be selected and trained in line with key experience and relevance of said experience. It would not dictate how the company should write a procedure to do this. An auditor would inspect training and induction records in order to gain satisfaction with regard to having the right operator in the right place at the right time with the correct training in terms of the situation.

This is key to all elements of the proposed MACE standard approach.

Such statements are easily made. Their effective implementation however, relies wholly on the active involvement and participation of UK PSCs and interested parties, including the UK government. In line with this requirement, there are a number of prime elements which need firstly to be established with the PSC marketplace. These are:

• Agreement of the market standard.
• Registration for individual operatives
• Registration for companies
• The creation of an independent industry standards body to act as an authority

The PSC Market requires transparent and structured discussions to implement regulation, market structure and controls to help protect companies, their employees, civilians and PSC Clients. 

During the current formulation of the MACE Standard, the following elements were identified within the UK PSC Market Place to ensure adequate hierarchy and structure.

1)            Individual PSC Operative Registration

British armed forces have consistently proved to be one of the best trained and most capable organisations in the world and although their adaptability, dedication and professionalism is rarely in question, it has be recognised that the training issued to armed forces personnel is not readily recognised, understood or even accepted in industry. This is not a sign that the skills are irrelevant, but more of indication of the lack of understanding in ‘Civvy Street’. 

Thus, success in the PSC Marketplace can be managed through a database which would offer registration for operatives, thereby ensuring that the structure and controls are in place with regard to allowing operatives to reach a standard in terms of skills and recognisable criteria required throughout the PSC and associated industries. Competencies required within the marketplace need to be agreed and evidence maintained by operatives, to ensure that standards are preserved.  In this manner, the availability and applicability of second career for ex armed forces personnel in a specialist role, in an increasingly specialist market, is more clear and relevant. This inevitably ties into a more transparent and marketable industry, safeguarding both employee and employer.

2)            Company Registration

Clearly, Private Security Companies are here to stay and are providing services around the world for a wide and varied selection of clients, including governments, NGOs etc.  The second control identified during the formulation of the MACE Standard is that of company registration.  Civilian UK companies face the rigours of a changing and developing world and there is a defined responsibility for risk management and security with respect to the protection of employees abroad in line with the Health & Safety at Work Act. The intent of company registration is to permit potential PSC Clients to select those companies who have proven their professionalism and integrity within the industry and enable them to ensure that they employ the most appropriate and competent organisation for their needs.

The need for legitimate and professional PSC activity will help ensure that qualified companies achieve an agreed standard which in turn allows them to gain contracts within the marketplace.  Failure to comply or maintain the required criteria would result in suspension of certification.  This registration will act as an approved supply chain for PSC clients, ensuring that they only employ or consider those companies operating within the bounds of the standard. 

3)            Market Standards

The concept of using a specific market standard is of course not unique.  Standards provide an agreed framework, outlining those practices to which companies must adhere.  The MACE Standard is being proposed for consultation within the marketplace with a view to developing and enhancing standardised requirements.  These would be internally and externally audited against agreed criteria.  The aim of the standard centres on capturing concerns and controls within an agreed framework which, it is proposed, will be developed in tandem with British PSCs and stakeholders.

4)            Standards Body

Once a standard is formed, agreed and implemented, it is vital that it develops with the changing requirements of the market and lessons learned from market findings.  To ensure that this is carried out in a controlled and transparent fashion, an independent standards body should be created to manage and continually improve the standard as well as acting as an external certification body to PSC Companies, who would apply for and achieve certification to the MACE Standard.  Company Certification to MACE will require bi-annual external audits with ongoing evidence to show that the company has monitored and stressed compliance over the course of its contracts.

The ultimate aim therefore, would be to develop a public facing database of certified companies, who, through their own efforts, have established themselves as professional, reliable and transparent in terms of the legality of their contracts and the conduct of their personnel. Over time, the most lucrative contracts in the industry, would be given to those certified companies and inevitably, the market would dictate the requirements for tenders and create a level to which companies should aspire if they are to compete. Hence, the industry as a whole, is made more legitimate.

5)            Governing Body

The establishment of a governing body, acting as an oversight and enforcing authority, is key.  The body should be an independent organisation which reviews all complaints and serious incidents and collates and analyses reportable statistics from PSC Companies, related to deaths, clients and the scope of contracts.

This body would work directly with the company registration database and the standards body to ensure that enforcement and notification of suspensions are recorded and available in the public domain.

Boots on the Ground – Auditing in the Field

It is said in the business world that a good auditor is worth his or her weight in gold. Simply put, this is because the auditor will ask the right questions and easily determine when some record has been fabricated or some principle is being misinterpreted. Indeed, auditors can turn their skills from quality through health and safety and even chain of custody standards, using their questioning nature to say yes or no with regard to ongoing certification; displaying the same skills in each niche sector of standards development.

It is entirely arguable whether such auditors can audit a PSC against a private security standard.

There are a number of reasons for this, not least of which is the business mindset.

Business standards are, by their very nature, concerned with relative simplicity, checks, continuous improvement and the nature of variability in terms of contractual obligation. There are subtle differences in the nature of the service that a PSC provides.

The adage ‘no plan survives first contact’ is true in any walk of life, though in the business world, and of necessity in the ethos and structure of business standards, much of this can be addressed through good management and awareness of competitors. There are few instances where an independent body is actively acting against the contractual interests of the company, in a manner that exceeds the rigours of simple competition. Hence, although there are many contractual, procedural and operational elements within a proposed PSC standard, there is also a requirement for a key understanding of the nature of the work and ultimately the people who carry it out.

Our question then centres on the capabilities of the ‘auditor’ role as it currently exists. It is our belief that the MACE auditor heralds a new breed, in an industry, which, as we have alluded to, is entirely different in terms of work done and the requirements of contract fulfilment.

With impending cuts in the armed forces, it is proposed that ex service men and women could be key to the future of MACE or any private security standard. It is both pertinent and relevant to train an ex soldier to audit. It is a major undertaking to train an auditor or business systems expert to speak and act in a manner which would promote understanding in the field and environment within which a PSC would work, no matter what their understanding of the standard.

MACE as Market Leader

UK companies face the rigours of a changing and developing industry. The intent of MACE is to permit them to ‘lead’ through the propagation of an industry standard which would highlight their ‘professional transparency’ to the world. This term would indicate immediately that their operational integrity is not in doubt, while still allowing them to fulfil their contracts.

With an informed public and a mass media which can bounce ideas and concepts around the world in seconds, integrity is something of an abused concept in our modern age.

Operational concerns would always require a degree of secrecy (another somewhat abused term perhaps), though operational norms would be audited. This would highlight issues such as misuse of equipment, abuse of prisoners, availability and applicability of training and conduct in the field. All of these issues, if mismanaged, can destabilise an operation or create tension for companies operating in contact with the media. The role of a standard therefore, to some extent, is to clean up the market in terms of perception.

A company that has been audited and recognised against an approved standard would therefore imply the professional transparency and professionalism noted above, opening up not only a new era of understanding, but a wide vista of business in new sectors for UK companies. With arguably the best military training and experience in the world, this is, in the authors’ opinion, as it should be.

Conclusions

The PSC marketplace is still evolving. With current operations in progress around the world, including the war on terror and growing with unrest and uncertainty in the middle east, there is still a clear need for the industry.  This does not make the prevalence of PMCs wrong, but there is clearly a responsibility that sits hand in hand with the companies concerned, with regard to controls and mechanisms surrounding their activities.

 A standard should not be onerous, but should certainly set the bar with regard to the requirement for operational effectiveness and transparency in the industry.

Handled correctly, the MACE Standard and the market mechanisms outlined within this article, will improve the profile and increase the reputation of UK PSCs and help ensure compliance for an industry which will provide both employment opportunities and competitiveness for British companies.

The gap between the business world and the nature of private security with its military connotation, precludes an approach to auditing which is based around a purely business focused ethos as there are implications for strictly military concerns. It is therefore easier for ex service men and women to gain auditing skills and thereby ask pertinent questions, than it is for auditors to gain an appreciation of military concerns.