Verisk 3E

Compliance - You have to do it, why not do it well? (A white paper for companies striving for EH&S Excellence)

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Courtesy of Verisk 3E

Untitled Document Abstract

Managers face a myriad of challenges in today's business world - challenges stemming from downsizing to consolidation. In addition, company leaders find themselves trying to do more with less in a juggling act of responsibilities and oversight. Among a company's responsibilities is environmental health and safety (EH&S) compliance, including the proper handling of hazardous materials (hazmat). At the bare minimum, companies want to avoid fines and keep employees safe. Another approach is to take compliance measures that go above and beyond regulation requirements and instead aim for EH&S excellence. It is possible - especially with the added expertise of an EH&S outsourcing company.

Compliance: You Have To Do It - Why Not Do It Well?

"Transition" has become a catchphrase in today's business world. Companies and their leaders work to incorporate changes stemming from tightened budgets where everyone competes for funding. Managers are asked to do more with fewer and fewer resources. At the same time nearly everyone quietly worries about job security and prepares for possible corporate consolidation.

Perhaps no one works in a more challenging atmosphere than do EH&S professionals. Economic forces demand that downsized EH&S departments stay at peak performance and manage increased responsibility with fewer personnel resources.

Beyond the headache of resource and compliance issues, overburdened EH&S staff
must maintain focus on ensuring a safe working environment. Reduction in risk assessment and training can lead to an increase in accidents and chemical exposures resulting in increased workers' compensation claims, fines and production interruptions. These outcomes impact a company's profitability - an issue of concern to managers at all levels.

Two Ways To Approach Compliance

Since the 1970s, with the creation of OSHA and the EPA, companies and their managers have had to address ever-expanding hazmat regulations. Hazardous waste regulations changed the way that hazmat wastes were managed and introduced "cradle to grave" liability for hazardous waste. The 1980's brought the Hazard Communication Standard, compelling industry to determine the hazard properties of chemical products and to disclose those hazards to all workers who could potentially be exposed to those products. It was a radical shift in workplace history as formal laws recognized the rights of employees to safe working conditions and the rights of society to be protected from the mismanagement of hazardous materials and wastes. Three decades later, compliance with government regulations relating to the manufacture, transport, use, storage and disposal of hazardous materials is universally accepted; and affects virtually every commercial enterprise in the United States and throughout most of the world.

Today there are two primary approaches to hazmat management. One sets compliance with hazmat regulations as the goal, tasking EH&S managers to "keep us out of trouble."
This minimalist approach asks managers to concentrate on staying within "letter of the law" compliance, primarily to avoid fines and the potentially damaging fallout of bad press. On one level, this approach makes sense - if a company follows the rules exactly as written, it won't be fined and will be reducing the chance and occurrence of employee accidents. However, this approach fails to embrace the intention of EH&S regulations - to recognize the regulations as the minimum level of hazmat management that they are intended to be - and to understand that great benefits to employee safety and liability reduction can result only from integration of EH&S management practices tailored to each business's specific operations.

Excellent companies put energy into moving above and beyond the letter of the law to concentrate on its spirit and intent. They then find themselves spending less energy, money and time worrying about maintaining a minimum level of compliance and instead take their companies to a new level where the goal is to keep employees healthy, eliminate accidents, and control hazmat liability. "When groomed only to help control costs, you turn an eye away from the spirit and intent of the regulation," said Steve Hollingsworth, who has 15 years of EH&S field experience developing and managing complex technical and informational EH&S systems. "Along with corporate sustainability, there is a moral argument to be made. EH&S management can be married to the core values of a company to not only keep it in compliance, but also make it a good corporate citizen."

Outsourcing: a Cost Effective Solution

Fortunately, there is a cost effective solution for bolstering your company's compliance efforts: contracting with an EH&S Business Process Outsourcing (BPO) company. With outsourcing, unbiased EH&S and hazmat experts can assist your staff to identify the most effective areas to apply internal resources, and those areas that lend themselves to outsource to an expert third party. A BPO provider can tailor a solution specific to a company's EH&S and hazmat information and compliance needs, not only keep it out of legal trouble, but to develop an EH&S program that aims for - and achieves - excellence.

The first step is to determine where a company stands in regards to compliance and safety. Most companies working with a good outsourced provider first conduct an initial compliance assessment to see where it's EH&S efforts succeed and where they need reinforcement. After this assessment, several programs might be put in place to better secure worker safety and come into alignment with compliance standards. Outsourcing some of the more mundane tasks associated with compliance, such as MSDS obtainment and management, regulatory reporting, chemical classification, training or waste management, can free up the internal EH&S staff, enabling these professionals to focus on the more strategic tasks associated with implementing an outstanding EH&S program.

What Comes After Compliance? Excellence!

Once a thorough program is in place, taking it to a new level and exceeding compliance standards is not as complicated as you might think. In fact, Hollingsworth says it's a matter of answering basic questions. "EH&S decision makers can avoid jumping through legal loopholes and instead
simply ask, 'Should we use this chemical or not?' 'What level of hazardous waste reduction and recycling is practicable for our operations?'" he said. "It comes down to questions of EH&S strategy that go above and beyond simply meeting compliance requirements."

There is value in taking the high road. Companies that implement proactive compliance programs are shining examples to employees and the community. In addition, if there are thoughts of global expansion, they will find themselves more readily accepted and respected in other countries that take environmental concerns very seriously.

"That's an excellent point," agrees Michael Beckel, a safety engineer with nearly two decades of experience in EH&S management and training development. "As companies expand into international markets they face a myriad of national and regional environmental and safety regulations, often more stringent than those in the U.S. A proactive company with a strategic EH&S program can more easily adapt to the regulatory climate in new regulatory environments."

In addition, concentrating on a strategic approach to EH&S management leads to less stress for managers at all levels. Because it's easier to stay a step ahead rather than trying to play catch up, companies that take compliance to a new level spend less time "putting out fires" prior to or following inspections. More than that, they take pride in meeting strategic EH&S goals rather than just doing what is necessary to get by. "Proactive companies look at EH&S management excellence as their goal versus 'What's the least I can get away with?'" said Michael. "They can point to EH&S as a place of pride - an area of excellence that improves competitive position."

The number of corporations with a well developed EH&S and hazmat strategy are increasing. Companies with a cohesive strategy achieve remarkable value, not to mention international recognition. These companies and their EH&S attributes include DuPont and its safety strategy; 3M's pollution prevention focus, Bristol Myers Squibb's reporting strategy; Dow's global EH&S standards and Intel's supply chain and design for excellence strategy. They garner respect not only for their business success, but also for their attitude of achieving exceptional EH&S management.

"It brings it back to the spirit and intent of the regulations," said Hollingsworth. "It's why you have an EH&S manager in the first place - look at what they can do for you and your company."

Raising your company's EH&S standards will not only save time, energy and dollars, it will place it on higher moral ground and lead to an improved image, a stronger brand and a greater competitive advantage. A good outsourcing partner can assist you by assessing your EH&S situation, identifying potential trouble spots and recommending ways you can meet and exceed compliance standards. Having an exceptional compliance program provides value on many levels - and, for many outstanding companies, is simply the right thing to do.

1. Krout, K., "Part II: Is Safety Really the No. 1 Priority?", Stevens Publishing Corporation, 2004.
2. Richard MacLean, "What's Your Strategy?", Environmental Protection, May, 2001.
3. MacLean, "The Strategy of Value", Environmental Protection, November, 2003.

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