Taking EH&S Compliance Beyond the Firewall and into the Wider Risk Framework

April 6, 2016

Environmental Health and Safety (EH&S) failures come with a high cost. The cost of human life and irreparable environmental damage can't truly be quantified, but the financial and reputational impact is often significant, running into millions, and in some cases such as Deepwater Horizon, tens of billions of dollars.    

Globalization, international regulatory focus on sustainability and more complex supply chains present significant challenges for the effective management of EH&S risk. The impact is further compounded by increased regulation (over 30,000 pages in US Federal EH&S regulations alone) and significant increases in enforcement action and penalties (as an example, EPA's US$ 405 million in civil and enforcement penalties in fiscal year 2015 were 2.5 times those in the previous year).

Spend in EHS increasing as complexity grows

It should come as little surprise, in this context, that board focus is on EH&S Risk Management, and that this is translating into increased investment in this area.  A global survey by independent analyst firm, Verdantix of 312 EH&S executives found that 10% of firms will increase 2016 EHS spending by double digits, while an additional 21% will increase spending by at least 5%. Only 3% of surveyed executives expected EH&S budgets to decline in the coming year.

Companies shifting their approach to risk

The survey notes that among the trends driving this uplift is that leading firms are increasingly reframing their EH&S strategies in the context of operational risk management, as they look to move beyond simply fulfilling compliance requirements.

One focus of this investment is the more effective management of EH&S through technology.  The Verdantix Green Quadrant® EH&S Software 2016 Report, which provides a detailed, fact-based comparison of the 22 most prominent EH&S software suppliers globally, found that  managing operational and regulatory risk continues to underpin investment in EH&S software, with experienced users increasingly looking to implement an integrated platform to manage all EH&S impact areas.

SAI Global recognized as an innovator in EH&S Risk Platforms

SAI Global's Cintellate platform, was recognized in this report as an innovator among the vendors. In particular, Cintellate was called out for:  

  • Its strengths in safety management

  • Incidents, management of change and audits

  • Its leading mobile application

Jan Kruger - Head of Risk and Assurance at SAI Global noted: “We are pleased to be recognized as an innovator; our clients, which span a diverse range of industries including energy and utilities, manufacturing and construction, oil and gas, healthcare, retail, food and government benefit from the flexibility of the platform and also note its mobile application as helping them to transform how data is captured and accessed in the field.”

SAI Capabilities Support a Holistic Approach to Risk

 

However the important trend in the market to note is the shift from siloed EH&S compliance to managing EH&S as part of a larger risk framework

Jan Kruger

Head of Risk and Assurance SAI Global

“ We're working with our clients on this journey and are uniquely placed to support them.  The ability for customers to gain greater Risk Intelligence into efficiencies in terms of where to allocate effort, and in particular, where to focus training and remedial activity. Increasingly businesses want to talk to us about how to really improve the whole system, beyond providing a point solution.

Risk across an enterprise is so intertwined and interdependent. Consider Deepwater; this wasn't just an EH&S failure, but a failure in 3rd Party Risk Management, as it was BP subcontractor Transocean Ltd - not BP itself - that owned and operated the Deepwater Horizon drilling rig used to extract oil from the well.

The management of risk also goes beyond software. There's a whole risk lifecycle that companies need to manage and software technology is just part of the solution. 

We work with our clients on a complete solution, from providing standards,  like the upcoming ISO 45001 (health and safety) and ISO 14001 (environmental) and auditing and certifying to them, through to providing onsite and public training, ” says Kruger.

To learn more about how SAI Global can help you with your EH&S Management system, click here and to learn more about SAI Global's Cintellate, please click here

About Verdantix

Verdantix is an independent analyst firm which provides authoritative data, research, analysis and advice to organisations to succeed with their energy, environment and sustainability strategies. Click here for more information about the Green Quadrant EH&S Software 2016  Report.