The safety professional and managing business risks

Allan St.John Holt

Head of Safety

Royal Mail Group

On the record

Don’t believe all you read in the papers!

Royal Mail is doing fine!

We deal well with the competition…

On the record

•Accidents: RIDDOR

Per 1000 SIP

2001 – 2002

43,530 9,327 194.4

2002 – 2003

40,525 Down 6.9%

9,185 185.7

2003 – 2004

35,948 Down 11.3%

7,273 172.7

Where does health and safety fit into business risk management?

• One of the major risk areas for any business

• Legal requirement, not just financial risk

• Solutions readily available

• Competence path for practitioners

• Mainstay of corporate governance

• Links to other core risk areas – finance, brand/reputation, emergency planning, other regulated areas

• Royal Mail Group Safety inputs into:

Corporate Risk Management Committee and Risk Register

Corporate Governance Committee

CSR – the next step forwards:

•Safety

•Health

•Environment

•Social policy

•Diversity / inclusion

What is CSR?

Short definition: “Doing the right thing for our people, our business and the communities we operate in”.

We do the right thing because our 

CUSTOMERS want to buy from companies that share their values

EMPLOYEES want to work for companies that provide a healthy and safe environment and whose values align to theirs

COMMUNITIES want companies that create the incomes, the jobs and contribute to the cohesion that builds neighbourhoods where people want to live and work

Benefits of the CSR approachJoining the dots –

• Where does the management of stress fit in?

• Where does rehabilitation fit in to your planning?

• Is sickness absence just a health issue?

• Is recruitment just an HR issue?

The benefits include an integrated approach and joined up strategies

•Plus an improved cultural awareness in the business

•Ability to think outside the pigeonholes

•Silo mentality starting to break down

•Managers question the ‘business as usual’ philosophy

Benefits of the CSR approach• Social policy:      Recruiting from socially excluded groups: - A potential candidate pool

of over 1 million people has been identified from disadvantaged facets of society that include the homeless, those with learning disabilities and ex-service personnel, from which the best candidates can be chosen.

       Payroll giving - at present our employees voluntarily give around £2.3 million pounds annually.

      ‘Royal Mail Cares’ programme to facilitate and support business-led employee volunteering.

     The charitable donations process is being rationalised with an objective process to ensure that all donations benefit a number of stakeholders in a win: win scenario for the business, employees, recipient and community.

The safety challenges for management – the big three hot buttons•The moral issue

Intangibles – brand damage

Loss of reputation

Weakened position with business partners

Seen to be poor at managing

Morale of the workforce

Problems recruiting

The challenges for management

•The cost – some of it

Royal Mail compensation p.a £14 million

Solicitors fees £4.5 million

Accident absence at £70 a day £15 million

- all straight off the bottom line

Insured costscovering injury,

ill health, damage

Product and material damageAction by Regulator

Plant and building damageLegal costs

Expenditure on emergency suppliesCleaning up

Production delaysOvertime working

and temporary labourInvestigation time

Supervisors’ time divertedClerical effort

FinesLoss of expertise/experience

Product and material damageAction by Regulator

Plant and building damageLegal costs

Expenditure on emergency suppliesCleaning up

Production delaysOvertime working

and temporary labourInvestigation time

Supervisors’ time divertedClerical effort

FinesLoss of expertise/experience

Uninsured costsUninsured costs

The challenges for management

•The lawTougher is the trend

Penalties for negligent managers are growing

Now seeking fines appropriate to turnover

Corporate killing laws soon in the UK

Bill Callaghan, Chairman HSC:“If you cannot manage health and safety, then you cannot manage… there is no excuse for those at the top to be ignorant of their responsibilities or to fail to take effective action….. inspectors must consider carefully the role of individual managers and directors when serious failures do occur – and ensure that appropriate action is taken against them if the evidence justifies it”

28 January 2002

Bridgend – an injury waiting to happen

•Tolerance of rule breaches

•Inadequate risk assessment

= unsafe system permitted

•Failure to act on warning signs

So what is the professional analysis?

The start point:

Recognition of the contribution

of secondary causes

 

Disaster: Herald of Free Enterprise

Primary cause: Bow doors not closed before leaving

Secondary causes (selected):No effective reporting system to check

this was done - system

Management attitudes – leadership, values

Tolerated work practices - accountability

People tend to notice management errors during public enquiries People tend to notice management errors during public enquiries

•“A full investigation into the circumstances of the disaster leads inexorably to the conclusion that the underlying or cardinal faults lay higher up in the organisation.

Herald of Free Enterprise Enquiry

•“The failure on the part of the management to give proper and clear direction was a contributory cause of the disaster”

Disaster: Kings Cross fire

Primary cause: Cigarette dropped on grease beneath escalator

Secondary causes (selected):Poor cleaning of escalator - system

Wooden escalator - equipment

Equipment failure – design/maintenance

Poor training of staff – policy & ownership

Culture - accountability

•Bottom line points:Finding primary causes usually doesn’t address the issues

Dealing with secondary causes is difficult – but:

The law is increasingly concerned with secondary causes

A structured, audited safety management programme is more likely to succeed than anything else

Increasingly, health and the environment are being addressed in the same way

…………………………………………… BUT (#2) -

.. there’s always someone just trying to help…

.. happy to take that little extra load

.. and cram a few more in!

•DEPLOYMENT IS THE KEY ISSUE

Some ideas that work:

•Accountability

•Policy, practice and the ‘safety culture’

•Testing opinions

•KPIs beyond accidents

•Consulting the workforce

•Transparency -the annual SH&E report –

And then - the annual CSR Report!

On the record

Look for our new CSR annual report 2003/2004 at

www.royalmailgroup.com

Your complaints or comments are very welcome:

allan.holt@royalmail.com