Practical advice for EHS transformation

Transforming your EHS program requires big shifts and practical changes, which means there are plenty of opportunities for improvement as well as potential pitfalls to be wary of along the way.

We recently collected the sage advice of 25-year veteran health and safety expert Anthony Wareham to create a eBook — A handbook for EHS compliance transformation. In this eBook, Anthony examines what makes an effective EHS compliance program, how to undertake the transformation to achieve it, and what pitfalls to watch out for in the process.

Read on for a taster…

The 3 steps to effective EHS transformation

Organizations with world class EHS compliance programs will go way beyond compliance, treating regulatory compliance requirements as only the first foundational step in achieving EHS excellence. To go beyond the basics, successful business transformations can follow three main steps:

1. Set a vision

Shift from a narrow focus to a corporate-wide picture, with clear objectives based on reducing risk, and integrated with business objectives and corporate culture.

Make sure the vision resonates with the end user and not just leadership. The vision should make it easy for leadership to enhance or monitor performance, but also not be an administrative task without any practical benefit. The best results are gained when the user gets a clear benefit — including accuracy and uptake, making the process a win-win for all. Think about maximizing the user benefits first and then seeing how to extract the management benefits in the most efficient and effective way.

2. Build a roadmap

A strategic roadmap covers the resources required, immediate milestones, and critical stakeholders you need.

There’s often a temptation to maximize outputs up front. This can overwhelm users who have many other tasks to perform, including maintaining current systems. In practice, it takes a lot longer to internalize new processes and success is often built on small, cumulative steps, giving the user time to get to grips with the new process with practical support before asking for the next step enhancements. Turn the new system into a pull system where the users want more functionality rather than a push system where leaders are demanding more outputs. Make sure the roadmap is SMART and benefits all the stakeholders.

3. Secure executive sponsorship

To succeed, a roadmap should be endorsed and fully resourced by executive leadership and under regular review with that team — with clear responsibility and accountability to meet its objectives.

So, what are the pitfalls to avoid?

Like with any program for change, there are inevitable challenges and complications that can hinder progress. Here are some of the most common pitfalls that companies may have to overcome in the process of transformation.

The role of culture

Company culture is defined as how you do what you do in the workplace. It’s the sum of your formal and informal systems, and the way the workforce interacts with them: all of which create an experience for your employees and customers. At its core, company culture is how things get done around the workplace. At the individual level, culture is an amalgamation of customs, beliefs, and values.

The transformation pitfalls of culture

Some of the most catastrophic safety events in recent history have been found to have poor safety culture as one of the major factors. Such major failures have catastrophic consequences, with massive financial and reputational impacts.

Companies will likely believe they’ve devoted significant effort to ensuring safety. Ask managers how they regard safety and usually they will tell you that it’s of paramount importance. Ask the same question of employees (assuring anonymity to ensure honest responses) and you’re likely to hear a very different story.

How can companies improve EHS compliance culture?

First off, ask the difficult questions.

‘Would a manager condone a short-cut to get an order out?’

‘What would employees say about safety in the workplace?’

Consider how your company would perform in a situation where the company faced investigations for EHS incidents and try to understand the true impact of significant failures. The true costs often don’t bear thinking about and that’s perhaps why many organizations don’t think about them too deeply. To manage this issue, you have to be brutally honest with yourself and be prepared to find issues that are hard to fix. But the starting point is knowing what the true baseline is — you can’t fix issues you don’t know about.

Secondly, standardize your standards across all jurisdictions — remember what JFK said earlier.

Because minimally acceptable standards can vary across the globe, companies should take care to not have different standards in different locations. Meeting legal compliance in one country would get you prosecuted in another. Moreover, the consequences of injury or illness could be catastrophic where medical and social support may also be of a very basic standard.

Companies should set up a compliance system that levels up to the most comprehensive regime in the countries that it operates in.

The role of vision-setting

The underlying aim of an EHS program transformation is to shift operations from a reactive approach to a dynamic, proactive one that anticipates and mitigates risks rather than always scrambling to remedy issues after they’ve occurred. To make this move, teams must have a clear vision of where they currently stand and where they’re aiming to reach.

This vision-setting can be broken down into four distinct areas to target:

• Knowing their gaps and close them
• Ensuring nothing is missing
• Knowing what regulations are coming and plan for them
• Having clear ‘ready’ data on-hand for regulators when needed

Sometimes, this is easier said than done.

Avoiding the transformation pitfalls of vision-setting

To not be trapped in a reactive approach, it’s necessary to know its consequences so you can identify areas at risk and in need of transformation. A reactive approach means:

• Assuming things are under control — until they’re not. This can breed a false sense of security because the longer the period without an adverse event, the more complacency it generates.
• A regulatory visit or an accident investigation can bring with it painful enforcement surprises. These usually require an upgrade of programs, equipment, or training to a minimum standard that must be met in a certain timeframe. The consequences of non-compliance are often backed up with an enforcement notice, which can also include fines and operational shutdown until the effect is remedied. Not understanding the minimum requirements can have serious implications.
• Companies can lose control in an adverse event situation. Without the ability to demonstrate that you have a plan to address the risk, you’ll be told what to do and when to do it by the enforcement agency. If you’ve evaluated the requirements and have a realistic plan to improve standards, it’s more likely a regulator will endorse it rather than issue a new set of requirements. It’s about demonstrating that you’re in control and have a plan to meet minimum requirements (and hopefully go beyond them).

These clear signs of a reactive approach to EHS compliance can be easily identified, if you’re looking for them, but overcoming them takes a concerted effort from all parties — including decisive and energetic leadership.

The role of leadership

Vision-setting and accomplishing its intentions relies on leadership. Understanding what leaders will commit to can be a balance between “compliance” at one end — the low bar of achieving what’s legally required — and “unsustainable costs” at the other — acknowledging that costs increase as compliance initiatives grow. Getting this balance “just right” ensures teams and (especially) leadership are making good on their promises.

Avoiding the transformation pitfalls of leadership

Strategic planning is needed to strike a balance between what’s required, what’s desired, and what’s feasible.

It’s important to take a pragmatic approach, especially when resources are scarce. Setting strategic (SMART) goals over a reasonable timeframe (say, five years) means they can be broken down into achievable milestones over that period. This avoids setting unrealistic expectations and allows for regular success celebrations on achieving each milestone — as well as each milestone providing the opportunity for reflection and fine-tuning if priorities change over the lifecycle of the plan.

Leadership should evaluate the resources needed and know the minimum standards across all areas of EHS, establish corporate standards that can go beyond compliance, and factor and plan for them to be scaled to the entire global organization.

Ain for success, plan for the pitfalls

It’s important for any organization looking to undergo an EHS program transformation to have a solid plan that truly represents the issues to be overcome, plus factors in the possible pitfalls that can hinder progress. This plan should:

1. Analyze your gaps to establish your true position regarding compliance requirements and any gaps, based on the risk they present
2. Structure your approach using an external management system like ISO to make sure all eventualities are covered — these are generally more rigorous and hold greater credence with internal and external stakeholders alike
3. Prepare you for adverse events so if a compliance visit flags any issues, you’ll have a ready plan to show the regulator — a well-resourced plan with a reasonable time frame is far more likely to receive endorsement
4. Have intermediate (short-term) control measures in place to demonstrate progressive management for longer-term issues

Not only does having a comprehensive plan in place make for an easier transformation process, but it also means being ahead of the regulators. This puts companies in control of planning and costs. Once a non-compliance is found, regulators can impose fines, penalties, and deadlines on companies, but with a plan in place, companies can remain in charge, demonstrating that the risk is known and being handled, preventing externally imposed enforcements.

The next step: Going beyond compliance

Once companies have completed an EHS compliance program transformation, staying on top of regulations and requirements should become standard practice. But to really excel in a fast-changing landscape, businesses need to maintain a competitive edge by going beyond compliance to exceed expectations and stand out as leaders in operational quality.

Learn more about how to go from a solid foundation of good compliance practices to elevate your program to a place of excellence in our eBook, A handbook for EHS compliance transformation, with more expert insight and experience from Anthony Wareham.