Exclusive luxury resort Soneva Fushi is embroiled in an increasingly hostile dispute with Biosphere Expeditions, an international environmental conservation non-governmental organisation (NGO), over allegations of grant contract breaching and “green-washing”.
Soneva awarded Biosphere Expeditions a three year, US$79,000 Social & Environmental Responsibility Fund (SERF) grant to conduct coral reef research, give scholarships enabling research placements for Maldivian nationals, and provide educational materials to local school children, beginning in 2011.
Soneva maintains they have no legal obligation to continue the funding.
Biosphere Expeditions alleges Soneva was delinquent in making payments for the first two years of the contract and now refuses to pay the final grant installment, which has dramatically limited the scope of the project, the NGO’s founder and executive director Dr Matthias Hammer told Minivan News.
“Unfortunately, Soneva displayed a lack of co-operative spirit paired with a good dose of corporate arrogance and incompetence right from the start.
“Biosphere Expeditions tried to be sympathetic, realising that Soneva/Six Senses were in financial trouble and offering various deferred payment options,” Hammer said in a press release issued March 6, 2013.
“However, Soneva is now ‘flat out’ refusing to pay the remaining US$24,000 owed, claiming Maldivian laws don’t obligate them to pay, only that they make ‘optional donations’. This is nonsense. They are legally obligated to fulfill the contract we’ve signed.
“Soneva cannot argue the contract hasn’t been enforced, because they eventually paid the agreed upon amount for the two years,” Hammer told Minivan News.
Hammer further explained that Biosphere Expeditions was “perplexed” by Soneva’s behavior given the company’s eco-friendly claims. The NGO claimed to have filed a case with the Civil Court last week.
“We were initially happy to receive the SERF grant. They were the last sponsor we’d expect to behave like this given their reputation. Their actions don’t match up.
“They have tried every trick in the book: saying the payment has been made but is late, there are internal issues within the company, the Six Senses company is being split, and they don’t have the money,” Hammer said.
“Payments were always late and a drain on our resources.
“I have never come across anything like this in the last 15 years of my career in this field. Given Soneva’s green claims, I am astounded by this apparent case of green-washing and how Soneva is treating its partners in conservation,” the NGO stated in a press release.
Soneva hits back
Soneva’s founder, president, and chief executive officer (CEO) Sonu Shivdasani also spoke to Minivan News about the dispute.
“Our public relations manager Sophie Williams proposed funding the Biosphere Expeditions project, but ultimately this project had more public relations benefit than real substance in terms of community development,” he said.
“We do not have a charter together [for evaluating proposals], but we have the different environmentalists on staff, such as our marine biologist, our management team, and representatives from the host committee to discuss the project proposals.
“Soneva didn’t do exhaustive diligence, but our team had discussed the project and went ahead [with approving it],” Shivdasani stated.
He cited three primary reasons Soneva will not continue to fund the Biosphere Expeditions project: the company has limited funds to donate, the project did not meet Soneva’s standards, and the agreement with Biosphere Expeditions is not legally binding.
“In essence, Soneva/Six Senses donates .5 percent of total revenues for charitable projects, which comes to about US$300,000 from US$20 million annually,” said Shivdasani.
Shivdasani explained that given the recent sale of Six Senses and Soneva Gili, the amount of charitable donations dropped. Thus, the company had to review and reevaluate the charitable projects they were funding.
“In 2011, Eva sold Six Senses, because we wanted to focus on the one brand Soneva, with one owner, management company, and philosophy,” Shivdasani stated.
“[Downsizing] to one resort and the subsequent reduction in SERF allocations from US$300,000 down to US$120,000, meant we had to carefully review how to use this money to create maximum impact on the environment.
“Invariably we needed to cut US$180,000 from our annual donations. US$24,000 is quite insignificant in context. There are so many more worthy causes, we’d rather spend money on other things,” added Shivdasani.
Shivdasani also spoke about the timing of the first two grant installments.
“The Biosphere Expeditions program has been very piecemeal and due to the specific nature of payments, any delays should not have caused payment hardships with the world in deep recession in 2009 and 2010.
“This was the worst recession since World War Two. 2009 was a slow year. Revenues were down and cash flow was tight. I can’t see how Biosphere Expeditions was inconvenienced. We were careful about the timing of charitable payments,” explained Shivdasani.
Soneva also decided the Biosphere Expeditions project did not “pass muster”.
“Unfortunately, Biosphere Expeditions did not meet up with our strict standards and we felt there were more worthy initiatives to support,” Shivdasani said.
“The feedback from hosts (staff) trained on the [liveaboard] expedition was negative, they didn’t enjoy the experience. Furthermore, we felt the education campaign did not have much of an impact, while the scholarship program only benefited two Maldivians.”
Regarding Biosphere Expedition’s allegation that Soneva had breached the grant agreement contract, Soneva maintained they did not have a legally binding contract.
“Rather than a contract with the Biosphere Expeditions, we had a charitable ‘Letter of Grant’ dating back to 2010. This involved a schedule of donations from Soneva Gili, Six Senses Laamu and Soneva Fushi.
“We could stop grant donations by giving notice, which Soneva did in the form of a formal letter in October 2012.
“We consulted our lawyers in Malé and they confirmed that three months was an adequate period of time to give notice to Biosphere Expeditions,” said Shivdasani.
He maintained that Soneva had no legal obligation to continue funding Biosphere Expeditions and that no case has been filed against the resort.
“Hammer is lying; no legal case has been launched against us. Our lawyers have not been notified of any case being filed in Male’. We are within our rights to stop funding.
“As of today’s date, we cannot contest any court case because Biosphere Expeditions have not put any case before us. No lawyer would want to represent someone who sends out press releases before lodging a case with the courts.
“If it was a legal contract, then we would have honoured it, but it’s within our rights not to continue.
“Soneva happily funded US$50,000-60,000 [of Biosphere Expeditions’ project], now it’s time to stop,” Shivdasani stated.
Soneva prides itself for being “an innovator in the field of responsible tourism, taking environmental and social responsibilities very seriously”.
Soneva states that its ‘SLOW LIFE’ philosophy “applies to everything” they do, with SLOW standing for Sustainable-Local-Organic-Wellness Learning-Inspiring-Fun-Experiences.
Thus, the Soneva SLOW LIFE Trust handles the Social & Environmental Responsibility Fund (SERF), which was created to “provide funding for a wide variety of humanitarian and environmental projects”.
Hostile exchanges
Communications between Biosphere Expeditions and Soneva have become increasingly hostile since the partnership agreement began, with numerous emails exchanged between Hammer and Shivdasani.
Following repeated correspondence requesting the agreed upon grant installments be paid, “Sonu said I was on a ‘high horse’ and ‘chasing the money’, all of which was in really bad taste,” Hammer explained.
“Soneva’s condescending top-down communication is a problem that comes from the very top [levels of management] and percolates throughout the company systemically.
“They think are a big powerful corporation and we’re just a small NGO.
“We shouldn’t be treated like this. Having jumped through all the hoops [to receive the grant] we bloody well expect the other side to pay what’s agreed,” exclaimed Hammer.
Hammer said that Biosphere Expeditions was surprised a luxury resort was “quibbling” over US$24,000.
“This is peanuts for them and we are not prepared to be treated like serfs or go away. By a funny coincidence that is what their grant is called: ‘Social & Environmental Responsibility Fund (SERF)’. I am only now beginning to understand its true meaning,” said Hammer.
Ultimately, Biosphere Expeditions has taken the stance that Soneva is not only violating the terms of their grant contract, but also guilty of “green-washing”.
“I can only conclude that Sonu Shivdasani and Soneva’s priorities are to maximise profits. They surely do not appear to be serious about conservation and the environment.
“It seems the company’s claims of ethical behaviour and environmental awareness are, sadly, simply marketing-driven lip service,” read the press release from the NGO.
Shivdasani maintains he has been misquoted by Hammer.
“The press release from Dr Hammer involves various threats of a slanderous nature. It is a sham. Hammer is not pursuing a legal case. If he does, Soneva has a very strong case,” said Shivdasani.
“Hammer is an extortionist. Someone needs to look into his operation. Is Biosphere Expeditions really a non-profit?” Shivdasani questioned.
The project
Originally, both Biosphere Expeditions and Soneva were partnered with the Maldives Marine Research Centre (MRC) of the Ministry of Fisheries and Agriculture, Reef Check and the Marine Conservation Society “to study and safeguard the spectacular coral reefs and the resident whale shark population”.
The funding dispute between Shivdasani and Hammer has curtailed the project’s activities.
According to Hammer, scholarships for and hiring of Maldivians has been halted, educational leaflets will not be distributed, and research studies cannot continue, with coral reef studies being “slashed to one week”.
Earlier in 2012, the Soneva Group faced controversy when allegations that Shivdasani had engaged a PR firm to “spruce up” the image of President Dr Mohamed Waheed Hassan Manik’s government were published in UK media.
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So only 2 Maldivians benefitted from the educational side of the grant, well that is reason enough to withdraw their funding.
Yes, luxury resorts are 'green wash' by NGOs like greedy Bio(insert any word here) NGOs' who do nothing but blackmail corporations. In NGOs corporate model, they position their greed based on public sympathy.
The envionmntal NGOs are some times the most perverted forms of business. What a joke.
Biosphere Expeditions would like to respond to the claims made by Sonu Shivdasani as recorded in the article above.
1. Sonu Shivdasani's claim that Soneva staff did not enjoy their time on Biosphere Expeditions' research expedition is demonstrably false. For example, Kate Wilson, a Soneva employee at the time recorded this feedback: “I have got so much out of joining this expedition and would like to thank Biosphere Expeditions for enabling me to develop as a Reef Check trainer. The next step is to train others, develop a Maldives-based Reef Check team and start submitting data from Maldivian sites regularly.”
2. Sonu Shivdasani's claim that the Soneva scholarship programme only reached two Maldivians is demonstrably false. Soneva provided funding for two Maldivian scholars per year to take part in Biosphere Expeditions' research expedition and be trained in Reef Check survey techniques. In 2011 four Maldivian scholars were hosted and in 2012 three Maldivian scholars were hosted. The additional places over and above those funded by Soneva were provided by Biosphere Expeditions as an effort of goodwill. In addition, the educational booklets produced by a local Maldivian artist and with input from Maldivian and international reef experts were distributed to Maldivian school children of the appropriate age throughout the Maldives (Hinavaru School, Maafushi School, Dhidhoo School, Kihaadhoo School, Kamadhoo School, to list but a few examples) by Biosphere Expeditions and the Live & Learn Foundation based in Male'. 2500 copies were also presented to the Ministry of Education's State Minister of Education Ibrahim Rasheed, who thanked Biosphere Expeditions and said that “We need to make sure people are aware of the fragility of our environment. Education can create this awareness, which is why environment studies is a compulsory subject in the new curriculum,” (see http://minivannewsarchive.com/environment/volunteer-team-collecting-data-to-protect-maldives-reef-ecosystems-24971).
3. Sonu Shivdasani's claim that no case has been filed and that "no lawyer would want to represent someone who sends out press releases before lodging a case with the courts" is demonstrably false. A legal case has been lodged in Male' and Biosphere Expeditions' legal representatives are Suood & Anwar LLP. The reason that Sonu Shivdasani has not heard is because the court registrar has to go through documents and sign them off. Biosphere Expeditions is surprised that Sonu Shivdasani seems to be unfamiliar with such basic legal processes.
4. Sonu Shivdasani's claim that the Biosphere Expeditions programme is "piecemeal" is demonstrably false and slanderous. The Biosphere Expeditions' programme was delivered exactly as agreed. Indeed Biosphere Expeditions frequently delivered over and above what was agreed (see point 2. above as an example) and then had to pursue overdue payments.
5. Sonu Shivdasani's claim that he has been misquoted is demonstrably false. The exact text of his e-mail of 29 November 2012 sent in response to Biosphere Expeditions' repeated reminders that legal action would be taken and a press release issued as a last resort if grant payments were withheld is: "Whilst I do not appreciate your threats and find this in bad taste [sic]. I am nonetheless replying."
6. Biosphere Expeditions strongly rejects Sonu Shivdasani's slanderous and demonstrably false statements of (a) Dr. Hammer being an "extortionist" and (b) Biosphere Expeditions not being non-profit. Biosphere Expeditions' status can be easily verified through charity listings such as the one by the US Inland Revenue Service (http://www.irs.gov/Charities-&-Non-Profits/Exempt-Organizations-Select-Check), where Biosphere Expeditions appears as a registered charity and can easily be found by its EIN identification number 72-1614948, to give but one example of Biosphere Expeditions' non-profit and/or charity status around the world.
In summary Biosphere Expeditions wholly rejects Sonu Shivdasani's slanderous claims that the Biosphere Expeditions programme is "unworthy" and of "no real substance" and that Biosphere Expeditions is anything but a non-profit and charitable organisation. Biosphere Expeditions also rejects Sonu Shivdasani's claim that the agreement is not legally binding and will continue to fight for Maldivian reefs and the involvement of its people, even in the face of Soneva/Sonu Shivdasani's slanderous and odious conduct, unethical greenwashing and corporate arrogance.
Dear Biosphere Expiditions & Sonu Shivadasani Esq.,
Please refer your dispute to AG, c/o Premier Ch. She has a simple solution - declare the contract void ab initio.
Thereafter, you may, if you wish to further contend the matter, refer it to arbitration in Singapore. The process will take ages and ultimately you will both forget you had a contract. Period.
Mathius do you think you have a chance of redress when coup leader President Dr Waheed and Sonu are buddies? Sonu and Eva's 'ethical tourism' credentials are definitely bruised following his efforts to whitewash the recent coup overthrowing the Maldives first elected government and now his shoddy treatment of Biosphere.
Wow.. a registered charity that charges USD 80,000. Talk about non-profit.
Both Biosphere and Sonu Shiva belong to Britishtani subjects of the Queen. So this story should really appear in the London Daily Telegraph, not on the Minivannews that humble Maldivains read.
NEVER in the HISTORY of NGO's has a single entity looked so BAD.
Take this argument back to the privacy of whatever court or legal proceeding you want but take it out of the public eye NOW!
The resort community is just coming back from 5 years of near ruin, and the NGO community is shocked at the claims and counter claims which damage future efforts worldwide.
Shame on both parties for displaying an absolute lack of foresight and tact.
Are we NGO's and businessmen and adults or mud throwing kids on a summer holiday?
This is not a news... delinquent grant payments from public/private sectors in this economy. This tough situ in tough time is affecting negatively to all. There is nothing wrong with exposing the existence of muddy swamps trapping grantors, who can't keep their words, and NGOs, whose demand surpasses supply. The public needs to hear. Legal actions against grantors are enforceable, depending on contents of "letter of grants" or "grant contracts" they signed, though possible future grantors may shy out, if not professional enough (obviously not the ones who would do name calling with excuses of numerous system errors).