IOSH Northern Ireland Branch

1
IOSH Northern Ireland Branch

• Tuesday 28th January 2003

2
G.S.J. Fulwell

• The Way Forward in OHSMS

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Contents of the presentation

• Introduction
• The Corporate onslaught in OHSMS.
• Key Performance Indicators.
• The position on Corporate killing.
• Recent developments in Global Standards
• OHSAS 18001 and Integrated Systems
• The ILO OHSMS Guideline
• IOSH international Specialist Group
• Questions.

4
Current position on standards

• ISO 9001 - Quality Management Systems.
• ISO 14001 Environmental Management Systems.
• OHSAS 18001/2 OHSMS management guideline.
• PD 6668 Integrated Management Systems.
• Environmental Management Auditing System.(EMAS).
• Risk Management Standards
• Standards for Corporate Accountability

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The Process Based Approach.

• The new approach to standards
• All new standards are no longer based upon the
  attainment of a prescribed level of performance
  but on the process based approach of continuous
  improvement.

( Guide 72 - May 2001)
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OHSAS 18001

• Agreed by major certification bodies.
• International credibility and development.
• A standards based approach
• Benchmarking opportunity
• Aligns with other standards - integration
• _____________________
• - Not an ISO standard.
• - Commercially based activity
• - Auditor Competence not defined
• - Development of the global ILO guideline
• - Application to sme sized undertakings

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Strategic approach formula
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Continual Improvement
Process of enhancing the OHS Management System,
to achieve improvements in overall occupational
health and safety performance in line with the
organisations policy
(OHSAS 18001)
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The Management Systems Approachin the Workplace.
Continuous Improvement
EMS QUALITY OHSMS
Standards. Legislation. Policy.
Risk Management influences the process
Minimum only.
Cooper 1998
10
Integrated Management Systems
Risk Recognition Risk Identification
External Market Environment
Risk Ranking Risk Mapping
Opportunities Assessed
Risk Surveys Risk Controls
Business Strategy Plans Developed
Integrated Risk Responses
Business Process Implemented
Audit and Compliance
Management Review
Risk Management Tool
Business Process
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The Manufacturing Environment.
INPUT.
PROCESS
OUTPUT.
Assets
Raw Materials. Supply Chain Management. Research
Development. Finance and Investment. Training
and Development. Energy.
Product or Services Marketing Distribution Waste F
inance
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Combined or Integrated?

• Combined v Integrated

MS
MS
MS
IMS
SH
E
Q
SH
E
Q
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The Integrated Strategy

• Policy
• Planning
• Implementation and Operation
• Performance Assessment
• Improvement
• Management Review

PLAN
DO
CHECK
ACT
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Common Elements of an Integrated System

• Element 9000 14001
  18001
• Policy 5.1, 5.3 4.2
  4.2
• Planning 5.2, 5.4, 7.2 4.3, 4.4
  4.3, 4.1
• Implementation 7.2-7.5 4.4.6
  4.4.5,4.4.6
• Operation 4.2 4.4.5
  4.4.3
• Performance 8.2 4.5.1,2,3.
  4.5.1,2,3.
• Measurement 8.2.2. 4.5.4.
  4.5.4.
• Improvement 8.5.2,3 4.5.2.
  4.5.2.
• Management 5.6 4.6
  4.6

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Key features of the approach

• Common organisational objectives
• Clearly defined responsibilities
• Common objective of continual improvement
• Based upon the plan,do,check,act approach
• Driven by top management
• Implemented as a project based approach
• Based upon a business risks approach
• Cross department ownership and commitment

Fulwell 2003
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Any Questions?
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Definition of an Audit.

• A systematic examination to determine whether
  activities and related results conform to planned
  arrangements and whether these arrangements are
  implemented effectively and are suitable for
  achieving the organisations policy and objectives

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3 Key stages of an audit.

• Documentation - reflects the hazards.
• Interviews - verify competence.
• Observations - implemented in practice.

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International Labour Office
ILO-OSH 2001
Guidelines on occupational safety and
health management systems
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International developments.

• International Labour Office proposal.
• technical experts met in April 2001.
• ILO Council met in July 2001.
• implementation programme being developed
• Alternative proposal from ISCSA.
• Strong support for the ILO from Asia/Pacific.

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The role of the ILO in OHS.
International Labour Organisation.
Conventions Recommendations
Monitoring Auditing
National Governments
Legislation and enforcement policy
National OHSMS Protocols.
Organisations Health and Safety Management
Systems.
Audit
Fulwell 2001.
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ILO - OSH 2001

• Section 3.2. Worker participation
• 3.2.1. Essential requirement of OSH.
• 3.2.2. Workers and their representatives are
  consulted, informed and trained ( including
  emergency arrangements ) in respect of their
  work.
• 3.2.3. Arrangements for active involvement.
• 3.2.4. Ensure the establishment and effective
  operation of a safety and health committee.

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Key points of the ILO.

• Reciprocal observer status with the E.U..
• Tri-partite organisational membership.
• A United Nations Specialist Agency.
• Linked to the World-Bank requirements.
• Role in defining minimum standards.
• Supervisory role in national legislation and
  enforcement policy,
• International role with member countries.

Fulwell 2001.
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Supply Chain Management.

• ILO (2001) section 3.10.5. Contracting
• organizations standards applied to contractors.
• Arrangements when on site must include
• a) criteria for evaluation selection.
• b)communications coordination between all.
• c)arrangements for reporting accidents/ill-health.
  
• d) specific awareness training arrangements.
• e) regularly monitor contractor performance.
• f) ensure all on-site arrangements complied with.

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Supply chain management.

• ILO (2001) section 3.10.4.1. Procurement.
• procedures established and maintained
• compliance in purchasing leasing specs..
• any relevant national laws in advance.
• arrangements made to ensure compliance before use.

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Corporate SHE Liabilities
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Corporate Liability

• Maintaining Stakeholder Confidence.

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Financial Times - November 15th 2002.

• ABB now has 110,000 Asbestos claims.
• ABB estimates its exposure at 812million.
• Hanson has 75,000 asbestos claims.
• Hanson has currently paid out 86 million.
• Hanson receiving 17,500 claims per year.
• Business News - Sunday 19th January 2003.
• ABB pays 1.2 billion to settle the US claim on
  asbestos liabilities and places Combustion
  Engineering into Chapter 11 bankruptcy
  protection. Assets 812 million balance ABB.

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Top Risks Facing the Organisation

• Strategic These are the long term strategic aims
  and objectives of the organisation.
• Project (These may also be considered as
  tactical or developmental risks). These are the
  change objectives, including product and process
  developments.
• Operational These are the day to day issues that
  ensure continued operation of the organisation

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RISK CONTROL STRATEGIES

• RISK AVOIDANCE
• RISK RETENTION
• RISK TRANSFER
• RISK REDUCTION
• or any combination
• Residual Risks will remain

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OECD Principles of Corporate Governance.

• Established in April 1998 - 5 principles.
• 1) Rights of Shareholders.
• 2) Equitable treatment of shareholders.
• 3) Role of Stakeholders.
• 4) Disclosures and transparency.
• 5) Responsibilities of the Board.

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OECD Guidelines for Multinational Enterprises 2001

• Follows a review of the 1976 guidelines
• Recommendations to Governments,
• Express the shared values of governments
• observance is voluntary
• principle of establishing a common position
• part of the Declaration of International
  Investment and Multinational Enterprises

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European Commission Green Paper.

• Promoting a European framework for corporate
  social responsibility
• In addition the tendency of companies to include
  OHSMS in their procurement.. ..which allows
  for a third party to carry out certification or
  initial approval of the contractors as well as
  overseeing the continuous improvement of the
  scheme.

EU September 2001.
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Corporate Governance

• Process by which corporate bodies govern
  themselves - a risk based approach

Strategy
Risks
Action
Information
Performance
No Surprises - ICAEW
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Corporate Governance

• Cadbury - 1992 -reporting of control
• Greenbury - 1995 - remuneration
• Hampel - 1998 - annual declaration
• Turnbull - 1999 - internal control
• Higgs - 2003 - role of non-executives

If the non-statutory approach embodied in the
code is to be successful over the long term, the
code needs to retain the widespread confidence of
shareholders, employees, government and others -
Institute of Chartered Accountants
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Internal control requirements

• Defined structures, responsibilities and
  reporting.
• Defined operating procedures.
• Objectives - business, department, individual.
• Financial and other resources prepared.
• Mechanisms and measurement criteria identified.
• Formal reporting of performance against target.

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Turnbull requirements

• Assessment
• Objectives
• plans
• performance targets
• indicators
• Control
• strategy
• culture - senior management demonstration
• Authority and accountability
• communicate to its employees

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Turnbull requirements

• The annual report will-
• The board is responsible for internal controls
  and reviewing its effectiveness.
• On-going process for identifying, evaluating and
  managing the companys significant risks.
• That is has been in place in the year.
• Process is regularly reviewed.
• A summary of the review process.
• The process applied to deal with any significant
  problems disclosed.

Accounts Digest - 417 - October 1999
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Higgs Report - January 2003

• Role of Non-Executive Directors
• Ratio of Non-Executive to Executive
• Training and selection of non-executives

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Civil Liability position.

• The changing position
• An opportunity or a threat?.

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The Insurance Market
Level and size of claims
Number and Scope.
Size and Number of Claims
Number
Reinsurance Market
Client
Broker
Insurer
Offshore Account.
Fulwell 2002
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The Insurance Market
Underwriting loss of 4.5 billion since 1993.
Fire 130 Weather 70 Theft 20 Stress
19 Commercial 100 Property 50
WTC - 80 billion Eur flood 60 billion Asbestos
stress Stock Market fall Reduced Capacity
Independent Insurance Woolf Reforms Claims size
frequency
Reinsurance Market
Client
Broker
Insurer
FLOW OF MONEY since 1991.
Fulwell 2002
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Catalogue of Disasters

• Forest Fires in Australia and the USA.
• World Trade Centre act of terrorism.
• Flooding in the United Kingdom.
• Collapse of Independent Insurance.
• Flooding in Eastern Europe.
• Asbestos claims globally.
• Earthquakes in Turkey.
• Collapse of the global stock market
• (ie 6 value loss on Monday 27th January ).

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The Changing Perspective

• Historic Position (pre 2001)
• Unlimited availability at very low premium, no
  requirement to demonstrate risk control.
• Future Perspective (post 2001)
• Limited availability at a very high premium and
  only with effective risk control.
• Significant role of OHSMS now emerging.

Fulwell 2002
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The Future Strategy

• The future requirements will be risk exposure
  based
• Identify the key exposures of the business
• Establish effective risk control for the key
  risks
• Monitor and review on-going performance
• Demonstrate a clear policy and effective control
• Establish liaison with the insurance provider
• Adopt a policy of continuous improvement
• Ensure that a risk based approach is the norm
• Identify significant influencing factors
• Review Management performance on a risk basis.

Fulwell 2002
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Criminal Liability

• Corporate and Individual accountability

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Number of prosecutions

• Year. Company. Individual.
  
• 1996/97. 1490 49.
  (10)
• 1997/98. 1606 25.
  (1)
• 1998/99. 1760 27.
  (0)
• 1999/2000. 2253 34.
  (11)
• 2000/01. 2077 43.
  (0)
• 2001/02. 2034 55.
  (11)
• 2002/03.

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Directors prosecution

• Brian Dean, a construction company director
  became the twelfth director to be convicted of
  work-related manslaughter at Stafford Crown Court
  and has been sentenced to eighteen months
  imprisonment.The prosecution followed a
  demolition accident in Stoke where a father and
  son were killed.
• Changed on Appeal to a Section 2(1) offence after
  5 months served, Jury misdirected.
• The Client, Daniel Platt was fined 125,000 plus
  costs of 10,000 for breaching CDM regulations.

HSB June 2002
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Fresha Bakeries Ltd.- Leicester.

• Fatal accident to two employees in 1998.
• Trapped in an oven at 100 Centigrade.
• Entered the oven to remove a broken part.
• Company fined 250,000 175,000 costs.
• Parent company, 100,000 75,000 costs.
• Managing Director fined 20,000
• Production Director fined 1000.
• Chief Engineer fined 2000.

HSB September 2001.
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Subcontractor electrocuted.

• Subcontractor was fatally electrocuted whilst
  undertaking maintenance work in an office block.
  Reaching into a false ceiling he touched an
  exposed control panel on an air conditioning
  unit.
• Doncaster Council were fined 400,000 plus
  31,000 costs
• Maintenance budget had been cut despite a
  previous incident of electrocution at the site,
  some years earlier.
• judge made comments about fine equivalent to the
  annual turnover if it had been a private company.

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EXEL fined for Workplace fatality

• Exel Europe Ltd., was fined 96k for a fatal
  accident when an agency driver was crushed by a
  reversing vehicle at the Comet operation in
  Corby.
• In addition the employment agency Taskmaster
  Resources Ltd was also fined 40k for failing to
  request copies of risk assessments and failing to
  ensure that Exel had introduced adequate
  arrangements for all relevant personnel.

MARS October 2002
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Corporate Killing Legislation.

• France,
• Canada,
• Republic of Ireland,
• Australia,
• New Zealand,
• UK - England and Wales
• United States of America.

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UK proposals for reform on Involuntary
Manslaughter

• a) Corporate Killing -
• specific offence making companies accountable
• b) Reckless Killing -
• person aware of the risk
• c) Killing by Gross Carelessness -
• conduct below that expected
• d) Killing when the intention was to cause only
  minor injury

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UK issues in Corporate Killing.

• The UK has specific problems in this area
• i) only individuals may commit a crime
• ii) requirement for the identification principle
• iii) prove both actus reas and mens rea
• iv) aggregation is not permitted
• v) vicarious liability only applies in civil law
• vi) no current recognition of corporate culture
• NOT included in the Queens Speech but not
  withdrawn from the proposed legislation.

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Republic of Ireland.Corporate Manslaughter Bill,
2001

• A Company shall be guilty of the offence if
• failure to manage or organise in a way which
  ensures health or safety of persons.
• failure amounts to conduct falling far below
  reasonable expectations.
• failure is the cause or one of the causes of the
  death of a person.

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United States of America

• Concept of respondeat superior
• A corporation may be held criminally liable for
  the acts of any of its agents if an agent commits
  a crime within the scope of his employment and
  with the intent to benefit the corporation.

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Canada

• New Private Members Bill, C-242 February 2001
• New Part XIII section 467.3 to 6 to Criminal Code
• A corporation is guilty of every offence of
  which an individual could be found guilty for
  committing that act or omission.
• section 467.6 (d)
• Corporate fault - C1,000,000 per day of offence
• Individual fault - C10,000 per day of offence
• unsafe workplace up to 7 years or life if a
  fatality

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The Pyramid of Sanctions.
Corporate license revoked
Corporate criminal sanctions
Corporate probation.
Court ordered disciplinary action
Voluntary disciplinary action.
Fines or civil penalties
Advice - warnings - persuasion
Braithwaite 1989
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Corporate Killing

• Defence of due diligence
• The company falls to be judged not on its words
  but its actions, including the action of its
  employees.

Wells, Corporations and Criminal Responsibility
, 2001
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Corporate Killing - due diligence.

• Evidence that the illegal and forbidden act was
  clearly in breach of established internal policy.
• Elements
• Specific company policy/procedures.
• Evidence that the illegal conduct was forbidden.
• Safeguards had been developed and implemented
  Lack of previous examples of the offence.

Wells 2001.
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Longford explosion.

• Longford Australia 25 September 1998
• Liquid flow into plant causes disturbance,
  control was not re-established
• Vessel fracture lead to hydrocarbon release,
  Explosion and Fire
• Casualties
• 2 Killed
• 8 Injured
• Fire extinguished 27 September
• Victoria gas supply cut off for 2 weeks

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Culture

• The commission noted
• over time a culture developed whereby it became
  normal to operate the plant in alarm. This
  culture developed despite the fact that the
  alarms existed for the primary purpose of
  alerting operators to that which was abnormalThe
  consequence was that the protective purpose of
  the alarms was lost The culture of operators
  regarding the operation of the plant in alarm
  was, in our submission, a contributing factor to
  the disaster.

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Conclusion

• The jury found Esso guilty of 11 breaches of
  workplace safety, including a failure to train
  staff properly and a failure to provide properly
  trained supervisors at its gas plant.

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A 2 million fine and A1 billion class action to
follow

• Justice Philip Cummins said the blast that killed
  two workers and shut down Victoria's gas supply
  for two weeks was no mere accident - it was
  avoidable and it was all Esso's fault.
• "The events of September 25, 1998, were the
  responsibility of Esso - no-one else," Justice
  Cummins told the Supreme Court. "The cause was
  grievous, forseeable and avoidable. The
  consequence was grievous, tragic and avoidable.
  To use the term 'accident' denotes a lack of
  understanding of responsibility and a lack of
  understanding of cause."

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BP - Prudhoe Bay, Alaska

• Major Corporate threat following an explosion
• Group BP - ExxonMobil - ConocoPhilips
• BP operates 1600 oil wells for the group
• Alaska Oil Gas Conservation Commission
• Largest oilfield in North America
• BP already on corporate probation

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Any Questions?
67
HSE - FOD - Risk Control Indicators

• Falls from Height
• Workplace Transport
• Musculoskeletal Disorders (MSD)
• Stress
• Slips, trips and falls on the level
• Hand, Arm Vibration, (HAV).
• Noise.
• Occupational Asthma.
• Management of Risks.
• Working Environment.

Source HSE, 2003.
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Fatal Accident Manufacturing

• YEAR Manuf. Constr. Total
• 1997/98 61 80
  274
• 1998/99 69 65
  253
• 1999/00 41 81
  220
• 2000/01 50 105
  292
• 2001/02 47 79
  249
• 2002/03 - ytd 21 36
  110
• As at 30/09/02 6 months.

Source - HSE Statistics dept.
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Fatal Accident Causation 2001/02

• Contact with moving machinery - 22
• Struck by falling object -
  43
• Struck by Moving Vehicle - 40
• Injured whilst handling -
  1
• Slips trips and falls
  - 2
• Falls from height
  - 68
• Trapped by collapsing/overturning 8
• Drowning or asphyxiation - 11
• Exposure to fire/explosion - 8
• Contact with Electricity -
  12
• Others kind of accident -
  22

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Current issues in OHSMS

• Civil Liability premium increases
• Corporate Killing
• Enforcement Management Model
• Accident Investigation
• Employee Representation
• Manual Handling survey by the HSE
• Directors duties

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International Specialist Group.

• Approved by Council in September 2001
• Comprises two separate Working Parties

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IOSH Specialist Groups

• Municipal and Public Services.
• Off-Shore Group.
• Construction Group.
• Environmental Group.
• Healthcare Group.
• Fire Risk Management.
• Railway Safety Group.
• International Group.
• Safety Sciences Group.
• Education Group.
• Consultants Group.
• In progress - Airways and Telecommunications.

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International Specialist Group

• 2 separate Working Parties
• Internal Working Party - focus upon the
  membership services required to support a global
  organisation and its development.
• External Working Party - focus upon the
  development of the Institution into a global
  organisation and the establishment of a network
  of international contacts.

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International Group Objectives

• Develop an international information web site.
• Review the International membership criteria.
• Publish 2 Learned Journal articles.
• Establish a network of international contacts.
• Establish a comparative qualification base.
• Increase the International Group membership.
• Investigate potential questionnaire in SHP.
• Monitor international developments.
• Present at the IOSH Conference.
• Advise IOSH of global developments in SHE.

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Any Questions?