Health and safety risk management is a critical component of any business. While the primary objective of health and safety risk management is to protect employees and other stakeholders from harm, it can also present a range of business opportunities or burdens.
Some organizations view health and safety risk management as a regulatory burden, requiring significant investment in time, resources, and money to comply with a complex web of regulations and standards. Others view health and safety risk management as an opportunity to enhance their reputation, attract customers and investors, and gain a competitive advantage in the market.
In this article we will investigate the importance of risk management in an organisation’s overall success. Learn about the value of Environment, Health and Safety (EHS) risk management and why it should be viewed as an investment.
Managing risk is an iterative process and assists organisations in setting strategy, achieving objectives, and making informed decisions. It is also part of governance and leadership and how a business is managed at all levels. It is therefore a management system, a tool that is used to assess all types of business risk such as financial, operational, environmental risk, etc.
As employers, you are legally obliged to keep all in the workplace safe from harm. Risk management of health and safety (H&S) risk, although obligatory, contributes to the improvement of management systems and enhances business performance. This article will detail the principles of risk management, allowing you to develop a suitable risk assessment management system for your business.
Risk management is not simply several documented health and safety risk assessments in a folder on a shelf. It is a live system, ever changing and evolving as health and safety and other business risks emerge and change. Central to the risk management system is risk assessment: identifying, analysing, and evaluating risk to people’s health and safety in the workplace. This can be seen in the following video from the HSE:
The approach and the type of risk assessment should be fitting with your business. There are many tools and various risk assessment types and matrices. However, keeping it simple and tailoring to your business works best and results in risk assessments that can be understood and followed by all.
Once risks are identified, analysed, evaluated, and eliminated or reduced to a safe level, documented and communicated you are meeting your obligation.
The objective of EHS risk management is to protect employees, customers, the public, and the environment from harm by identifying and managing the risks associated with an organization's products, services, operations, and facilities.
EHS risk management involves a range of activities, including hazard identification, risk assessment, risk communication, risk mitigation, and monitoring and review. EHS risk management can be a complex and challenging process, requiring a multidisciplinary approach that involves expertise in areas such as engineering, occupational health and safety, environmental science, and regulatory compliance.
Effective EHS risk management can help organizations to prevent accidents, reduce liability, and improve their reputation and competitiveness, while also contributing to the protection of public health and the environment.
While keeping it simple, remember that your risk assessment must be comprehensive, must be agreed upon and must be signed off by those involved or a manager on behalf of the risk assessment group. All departments, job tasks, processes must be risk assessed. Engaging workers in risk assessments assists with the capture of all hazards and the correct assessment of the corresponding risks.
However, risk assessment is only one part of risk management. To create and protect value using risk management, all elements of the system must be implemented. These elements although integral to many International Organization for Standardization (ISO) standards to include the health and safety standard ISO 45001:2018 are very well presented in the graphic below taken from the ISO 31000:2018 Risk Management standard.
The key elements are:
For effective results, risk management should be mainstreamed across the business and begin at the planning stage of the business, planning to purchase new raw materials, planning a new way of doing something, new staff etc. Many businesses do this very well for general business risks but health and safety risks, for many reasons, are not included or poorly managed in the general business structure.
Although there is a cost factor involved in risk management, often referred to as a ‘Regulatory Burden’, all business regulations add a cost to the business. So why do some businesses point immediately to health & safety as a burden?
Some common reasons for this include:
While there is a recognised cost to effective risk management, the cost of not managing H&S risk is far greater. The associated tools have been developed to assist businesses with managing H&S risk for this reason. There is a business case for managing H&S risk in addition to other business risks. As employers you need to remove the perceived barriers. A very common barrier to good H&S risk management and one of the main barriers noted in research is fear.
This perceived ‘fear factor’ has been expressed by many employers and employees due to the following:
Fear of participation in health and safety decisions is not substantiated. Ignoring health and safety and noncompliance is a much more serious matter.
The employer is legally responsible and accountable, while everyone in the workplace are responsible for safety and health of themselves and others in the workplace. The law requires business owners to demonstrate ‘reasonable care’ and a risk management system that considers and protects all in the workplace ‘as far as reasonably practicable’.
Taking a holistic approach to EHS risk management is critical to ensuring that an organization is addressing all of the risks to environment, health, and safety that are present in its activities or operations.
A holistic approach involves considering all of the interconnected factors that contribute to EHS risk, including organizational culture, management systems, human behavior, and the physical environment. By taking a holistic approach, organizations can gain a comprehensive understanding of the risks they face, including both direct and indirect risks, and can develop effective risk management strategies that address these risks in a coordinated and integrated manner.
A holistic approach to EHS risk management also recognizes that EHS risks do not exist in isolation, but are often interdependent with other risks, such as financial, reputational, or operational risks. By addressing EHS risks in the context of these other risks, organizations can develop more effective risk management strategies that leverage their existing resources and capabilities.
Rather than avoiding and fearing EHS regulation, look at incentives to involvement, cultural change lies at the heart of all proposals for change within organisations. Lead by example to achieve a cultural change, where employers are perceived as acting in the interests of their workforce, and taking health and safety seriously, employees will be prepared to do so as well.
A successful EHS risk management strategy is essential for any organization that wishes to operate sustainably and responsibly, while also protecting its employees, customers, the public, and the environment.
A successful EHS risk management strategy can have several benefits, including:
1. Protection of employees and stakeholders: An effective EHS risk management strategy can help prevent accidents and injuries, protect the health and safety of employees, customers, and other stakeholders, and reduce the risk of liability claims and regulatory enforcement actions.
2. Regulatory compliance: Many countries have laws and regulations that require organizations to implement EHS risk management programs. A successful EHS risk management strategy can help ensure that an organization is in compliance with these laws and regulations, reducing the risk of fines, penalties, and other sanctions.
3. Reputation and brand value: A commitment to EHS risk management can help enhance an organization's reputation and brand value, leading to increased customer loyalty, investor confidence, and competitive advantage.
4. Cost savings: An effective EHS risk management strategy can help reduce the costs associated with accidents, injuries, and regulatory enforcement actions, as well as insurance premiums and lost productivity.
5. Sustainability: A successful EHS risk management strategy is essential for organizations that wish to operate sustainably and responsibly. By reducing their impact on the environment and protecting the health and safety of their employees and stakeholders, organizations can contribute to a more sustainable future.
There is much research and resultant tools available on this subject. A list of some of these is presented below. This list is not exhaustive.
| Tools | Resources |
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Workplace Health Toolkit for Small Business |
HSA |
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Business and Education Supports |
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Safe System of Work Plan (SSWP) |
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By demonstrating the value and the costs involved, the business case for investment in H&S risk management and a good safety management system can be presented to senior management, shareholders etc. Demonstrating a business case will assist with getting all members of the organisation on board and engaging in health and safety in the workplace.
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About the author
Catherine Jordan, PHD, is a product specialist with EcoOnline. She has over 20 years’ experience working within HSEQ across many industry types and specialises in safety & quality management.
EcoOnline EHS is a software tool for managing your company's occupational safety and wellbeing. In the software, you will find ready-made form templates for the assessment of physical workload factors and physical work environment factors.
Learn more about digitizing your HQEQ-processes with EcoOnline EHS by clicking below or simply Request a Demo