By next spring, Carnival Corp. hopes to be doing business in Cuba. Earlier this summer, the U.S. government approved Carnival’s Fathom cruise brand to offer trips to Cuba. In order to comply with U.S. travel restrictions, the trips have to fall under the 12 categories of authorized travel, such as humanitarian projects, people-to-people exchanges or education activities.
The Fathom brand is Carnival’s newest brand concentrating on “social impact” cruises. If it gets the Cuban OK, it would become the first U.S.-based cruise ship operator to sail to the island since the trade embargo was put in place. Plans call for it to sail from Miami to Cuba every other week beginning in May.
Q. What attracted Fathom to the Cuba opportunity?
A: We were deeply engaged [and] immersed in building out social-impact experiences in the Dominican Republic well before the eased [U.S.] travel restrictions [to Cuba] in December of 2014. So when we got the word that some of those travel restrictions have been eased, it was natural for us to consider, [would] there be a possibility for us to serve the Cuban market and travelers hungry to go in in a differentiated way? It made sense.
Q. What was the process like for the American license that was granted from the U.S. Treasury and Commerce departments?
A: We have been involved in that process over the last few months. It’s a process that is a submission to the Department of Treasury and to Commerce, and we’ve worked closely with OFAC (Office of Foreign Assets Control). There’s a tremendous amount of information on the U.S. approval side that you have to be able to submit demonstrating really that you’re in alignment with those 12 authorized forms of travel. Because Fathom is a social-impact brand and it’s all about cultural immersion and education, it was really well-aligned. It was natural. It is who we are at Fathom.
That process has been a back-and-forth. They have additional questions and wanted to get additional understanding. They needed to understand the ship that we were considering from a technical and ports specification standpoint. We’re really fortunate because the Adonia, the ship that we’ve purposed to Fathom in the Caribbean, is a small ship. It has about 710-passenger capacity. It’s really an intimate on-board experience for travelers and a great education vehicle. Purposely, it doesn’t have a casino. It doesn’t have Broadway entertainment. It’s a very different type of ship. It fits and maneuvers well into lots of different locations. Cuba has 11 ports of promise. We imagine and desire to visit at least three ports during the seven-day trip itineraries that we will be taking to Cuba.
It’s a little bit different than what we’re doing in the Dominican Republic, because in Cuba, it’s a cultural immersion. It’s an education process. It’s really just the beginning of what we believe will be a beautiful and very lasting friendship.
We have a lot of work to do in Cuba. We want to really hear from the Cuban side [about] what is it that they are prioritizing as needs and opportunities, and then as we learn those things we’re happy to explore the potential to come alongside.
Q: Fathom has the American OK. You don’t have the Cuban OK. How confident are you that Carnival and the Fathom brand will be successful in getting the approval that Fathom and Carnival would like to be able to land a ship in Cuba in the spring of 2016?
A. That’s an important differentiation right because at this point we’ve been the first to be granted U.S. approval. We have not yet been granted Cuban approval. That said, we’re in process. We’re in active discussions, and we’re very confident that we will gain those approvals in the coming weeks. We’ll be communicating that information so it’s important to know that the Cuban officials and authorities still have to approve everything that we’ve lined out. So we don’t want to be presumptuous. It’s really important to us that we respect and understand their desires, and, of course, we’re going to comply with their needs and make this happen.
Q: You expect to be granted [Cuban approval] within a matter of weeks, not months or even years?
A: The reality is we just don’t know. There is uncertainty, of course, and yet we’re obviously rapidly engaged in those discussions, and we look forward to hearing in the coming weeks [and] in the coming couple months.
Q: But have you heard back from the Cuban government about your application? Is an application similar to the United States’?
A: We have been in active discussions. It’s a very different process.
Q: The chief of the Cuban Interest Section in Washington, D.C., had a comment regarding doing business with Cuba back in May when the Treasury Department first announced licenses for passenger ferries. He said at a legal conference, “These companies have to go to our authorities, they have to introduce their ideas.” Has Fathom and Carnival done that?
A: We’re doing the same thing. We are working with Cuban authorities. They’re aware of the idea, and the conversations have been active. We expect to be furthering those rapidly now that we just received the U.S. approval.
We were already engaged in active discussions [before receiving the U.S. approval]. We have 10 global brands, so some of our brands visited Cuba before and actually have a history and relationship with the Cuban government. Obviously, some of those things are long past, but we’re going to work to understand and learn as much and as quickly as possible. We’re going to continue the active discussions that we’re having there, with that back-and-forth with the Cuban government.
Q: What does Carnival and Fathom need to have as part of those discussions for your brand to have a successful launch and a successful business?
A: We’re going to find out. It’s very, very important to us that we understand the expectations from the Cuban officials and from the Cuban people. We absolutely envision this as a way to create cultural exchange between Americans and global travelers [and] also of the Cuban people. We’re excited about that dialogue and really the beautiful friendship that’s going to begin.
There are 12 authorized forms of travel. There are people-to-people programs happening today. There are lots of providers who provide people-to-people opportunities on the ground in Cuba, and so I imagine that we will be working closely with many of those providers. We also will be developing those types of opportunities ourselves over time.
Q: What about the infrastructure that’s necessary to be able to have a 710-passenger ship dock safely?
A: With the Adonia, [it’s] a small ship that can maneuver lots of different locations. We also have tenders. [They] allow us to approach ports and shore sites that others may not be able to approach. We’re a company with years and years of experience navigating very different port arenas. At this point, we are confident that that is technically feasible.
Q: Have you been able to do infrastructure examination in Cuba?
A: In the past months, we’ve been working closely to understand the technical specifications, [also] the accommodations. Taking the volume of accommodations for 710 passengers in some ways just eases what’s needed on the ground.
Q: In terms of the passengers being able to eat and sleep on the ship.
A: Yes. [Passengers] have the ability to eat and sleep on the ship. So as there are more travelers visiting Cuba, and as there are limited infrastructures on the ground, this is a way for Cuba to be able to provide even more people a great opportunity to experience the country.
Q: It provides ammunition for some critics about the engagement with Cuba to say a company like Carnival that has a floating hotel isn’t really providing a whole lot of economic engagement with Cuba because the passengers are not sleeping in hotels. They’re not eating necessarily in restaurants. They are just doing this cultural exchange with limited economic impact.
A: As you can imagine, there are always critics who are going to say things. My encouragement to them is to get to know us, have an experience with us. [In accordance with] the people-to-people guidelines, travelers have to spend eight hours a day in allowable authorized activities that include meals on the ground in Cuba. That includes small-business interaction. So from an economic development standpoint, there is no question that the impact that we will have will be incredibly favorable and positive for the Cuban people. And yet, the accommodation obviously is going to happen on board the ship. I think until someone truly knows and understands the travel experience that we’ve developed, and until they understand the intent and ethos of our company and our corporation, [they can’t] make their decision.
Q: Are there conditions that Carnival would not accept [from] the Cuban government?
A: We don’t foresee a situation that even gets to that. We are in very good, positive, active discussions, and we look forward to working together and understanding from the Cuban side what we need to do to be successful together.
Q: One of the chief critics of engagement has been Sen. Marco Rubio, who is running for the presidential nomination of the Republican Party. He wrote in a New York Times opinion piece, “When we make engagement with the odious leaders of these countries, our foreign policy, we make a Faustian bargain that is contrary to our national values and also to our strategic interests.” Is this Carnival’s effort against U.S. national values?
A: It’s clearly an emotional and heated topic. It’s hard to understand and imagine from those Cuban-American families that have a deep history and pain, the challenges that have happened. So we empathize a lot with the complexity. Yet we still look at the beauty of the Cuban people and the opportunities that we have if we join hands together and explore developing economic development, as well as cultural exchanges that will ultimately benefit the country and the Cuban people.
Q: The criticism goes beyond Rubio. Former Gov. Jeb Bush, who is also running for the GOP nomination, has spoken out against the Obama administration’s engagement efforts. They point out that while people-to-people exchanges may be culturally beneficial, ultimately the way the Cuban economy works, the money winds up in the hands of the Castro regime. What is Carnival and Fathom looking for in terms of your on-the-ground partners to assure that that risk is reduced, if not eliminated?
A: I think that we’re all [in] early days in terms of a new relationship with Cuba. I think just by the news that we’ve received from [President Barack] Obama in the last couple weeks with the opening of embassies, there are clearly very active discussions happening between the two countries. Our hope and intent and spirit are to continue to build favorable relationships with the Cuban people. And with Cuban authorities. I think we’re all looking forward to a different era because the era that we’ve been through has not necessarily solved any of the challenges between the countries.
Q: Perhaps it gets down to how Fathom and Carnival are going to select the partners that it works with on the ground for these people-to-people exchanges. What kind of criteria do you have? What kind of protections or red flags will you be looking for to assure that the business relationship that you’re getting into is one that is more of an enterprise relationship as opposed to a regime relationship?
A: It’s a great question. We have spent a tremendous amount of time building the social-impact partnerships on the ground in the Dominican Republic, our first country, and so it’s just going to take some time.
We have so much to learn in Cuba. We have so much to learn from those partners who’ve already been successfully operating on the ground. What we’re really focused on right now is education, immersion [and] understanding. It’s too soon to say exactly what our partnerships in Cuba will look like.
Our partners on the ground in the Dominican Republic have 30-plus years of experience offering social-impact programs at scale. One of them works in both the Dominican Republic and Cuba [and] has more than 10 years’ experience doing micro-enterprise development in Cuba.
We look for trusted partners with credible history. We look for people who have demonstrated results. We also work to engage lots of different stakeholders so we’re not just hearing from one opinion. We believe in “show” versus “tell.” So as much as we can sit here and talk about it, we’re trying to do the right thing. I think if you look at the people in our organization in terms of whom we’ve assembled to do this, it’s a pretty remarkable group of talent.
Q: How are you going about navigating the difficulties of those on-the-ground partners in an environment that Cuba presents, which is much different than the Dominican Republic and much different than other places in the Caribbean for political, cultural and economic reasons? The Human Rights Watch continues criticizing the Cuban government for stepping up arrests of political prisoners and others. And here comes a big United States Fortune 500 company looking to do people-to-people exchanges in a nation that continues to be on the list of places with the worst record of human rights.
A: I think it’s easy to dehumanize the country and not look directly at the people. There’s a lot of question and debate about what’s the right way to approach this new partnership and relationship with a new country. But, again, for me, it comes back to the humans and to the Cuban people. When there is opposition to engagement [with] Cuba, that’s really opposition to the Cuban people. What we hope to do is [to] bring a very human experience between the two countries. We know that often, many things happen through dialogue and a relationship. We’re going to continue to work to build genuine holistic relationships. We’re going to continue and invest in improving relationships and opportunities for our travelers [and] also for Cubans.
Q: Will this require capital investment on the part of Carnival and Fathom into Cuba?
A: We don’t know yet what investment potential is necessary to both get this going and long-term.
Q: Are you prepared to make a capital investment?
A: I think it’s too soon to say. We’re going to understand from the Cuban side what it is that they want to see to comply with their expectations and regulations to make this happen. We’re going to be open-minded about the possibilities. We’re confident we’re going to get to a solution together.
Personal: 38, married, mother of two young children.
Current role: President of Fathom, a social-impact company that offers a new category of travel, and global impact lead of Carnival Corporation & plc, the world’s largest travel and leisure company.
Career: Russell has diverse consumer product experience with Fortune 500 companies including GM, Intel and Nike, working across product development, technical sales and marketing, process engineering and manufacturing teams. She is a serial entrepreneur with experience developing, launching and building impact businesses. Over the past 15 years, she has been building non-profit and for-profit social enterprises. In Idaho, she founded and currently is chairman of Create Common Good, a food production and job-training model for refugees, women at risk, the homeless, people coming out of prison, anyone with a barrier to employment. Under her leadership, 90 percent of the people they have served have been placed in sustainable jobs, generating nearly $20 million in wages for people they have served. In her previous life, she lived in Thailand for four years offering pro bono small business development training to nongovernmental organizations, and she also co-founded three other social ventures for profit and non-profit: Jitasa, Nightlight and World Economic Forum Global Shapers Idaho.
Education: Bachelor of science in mechanical engineering with highest honors from the Georgia Institute of Technology.
About Fathom: Fathom, a new brand in the Carnival Corporation family and the pioneer of impact travel, provides the opportunity to build community with like-minded travelers, become immersed in another culture, and work alongside its people as they tackle community needs and create enduring social impact.
Sailing aboard the MV Adonia, a 710-passenger vessel redeployed from Carnival Corporation’s P&O Cruises (UK), Fathom will mobilize, educate and equip up to 700 travelers on every trip, allowing for thousands of impact activity days per week.
See video: Go to MiamiHerald.com.
WLRN Radio interview: http://wlrn.org/post/carnival-plans-begin-cruising-cuba