Black Swan events, holistic business continuity, Emerging Risk Audits, and non-financial risk management are terms swirling in C-Suites, on Boards, and in the business, risk management and auditing literature. Also swirling around are discussions about sustainability, corporate social responsibility, organizational resilience, as well as organizational health.
A recent survey of leading European companies, conducted by the Ashridge Business School and University of St. Gallen and reported in the MIT Sloan Management Review (Spring 2012), suggests that links between corporate functions and the CEO could be stronger.
Some of the reported consequences of these weak links include: mixed performance, more bureaucracy, a sense of C-Suite interference, lack of cooperation from operating managers, and a focus on transactional issues as opposed to value-added ones.
EHS auditing is a dynamic process that requires stakeholder input for success. Speakers emphasized this point during a breakout session at the 19th Annual NAEM Forum, which focused on the innovative practices that several companies are using to deliver maximum effectiveness and efficiency.
The speakers presented highlights from the recent International Audit Protocol Consortium’s survey on EHS audit practices: roughly 60 percent of respondents indicated a high rating for detecting regulatory non-compliance; 50 percent for management system conformance; 50 percent for benefit of audit results to the audited operation; and less than 50 percent for benefit to external stakeholders.
First Look: Highlights from the 3rd Annual MIT/BCG Sustainability & Innovation Global Executive Survey
Initial findings have begun to surface from the 3rd Annual MIT Sloan Management Review and Boston Consulting Group (BCG) Annual Sustainability and Innovation Global Executive Survey, which had over 4,700 respondents. In an earlier post, I discussed some of the findings that Martin Reeves shared last week at the CR Commit Forum 2011 in New York City. The current issue of the Sloan Management Review presents more findings and indicates that the full report will be available next winter.
An important finding is that while sustainability is an important issue in organizations, it is not a top near-term priority. As Reeves indicated in his keynote, companies are concerned about short-term volatility and, to some extent, survivability. The top three challenges reported for the next two years are: innovating to achieve competitive differentiation (46 percent); growing revenues (45 percent); and reducing costs and increasing efficiencies (41 percent). Fourteen percent indicated that responding effectively to threats and opportunities of sustainability was a challenge. Read More
Safety and Environmental Management Systems (SEMS) in Oil, Gas and Sulphur Operations – New Federal Rule
In the aftermath of the Deepwater Horizon event in the Gulf of Mexico, the Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE) has promulgated a regulation that requires operators of oil, gas, and sulphur in the Outer Continental Self to develop and implement a safety and environmental management system (SEMS).
The October 15, 2010 Federal Register announcement of this regulation indicates that the rule incorporates in its entirety and makes mandatory the American Petroleum Institute’s (API) Recommended Practice 75, “Development of a Safety and Environmental Management Program for Offshore Operations and Facilities.” The rule became effective on November 15, 2010. Read More
In my previous post, I briefly discussed the integrated quality, safety, and environmental management system (QSEMS) at the Cannes Convention Center. The trend toward integrated management systems, including ISO’s movement toward a generic management system model for wide application, will provide a new tool for organizational risk management.
As evolved as risk management methods and models are, organizations struggle with integrating risk management practices. A silo phenomenon challenges risk managers as it has EHS managers for many years. In current non-financial risk management writings and research, the need for risk management integration and “silo-busting” is highlighted. An integrated risk management system can provide a way to bust silos in an organization. Read More