Earlier this year, I wrote an article entitled “Where the S in ESG intersects with HS in EHS”. While I stand behind the tenor of that piece, there is one thing I said that gives me some pause. I wrote “Today, compliance with Environmental, Health, and Safety (EHS) regulations is a given. Employers must go beyond compliance.” That statement is true when viewed through the ESG and sustainability lens. But my history with clients, including recent work, has shown that sometimes even the most sophisticated of our clients still falls down when it comes to compliance with OSHA regulations. At times, companies within the regulated community have difficulty remaining in compliance with applicable regulations. So, how can they go beyond compliance to sustainability?
I’ll be the first to admit that compliance with governmental regulations doesn’t always equate to a healthy and safe workforce. Unfortunately, it doesn’t always work that way; however, when regulators discover violations and take enforcement action, investors, competitors, and employees will take notice. You simply cannot have strong ESG performance without a good compliance record.
Take the Hazard Communication Standard (HazCom) for example. Failing to properly label chemicals or not keeping an updated chemical list and corresponding Safety Data Sheets (SDSs) is always one of the Top 10 Most Frequently Cited Standards. In 2020, it was #2 on the list. HazCom has been around since the beginning of my career. You can do some research and see that is a very long time — over 30 years! What that means is that in three decades, many facilities still struggle with basic aspects of labeling and documentation. A recent project at a very large corporate client demonstrated this, when we discovered almost 99% of their chemical list was outdated or missing SDSs.
Another frequently cited Standard is Energy Control (a.k.a. Lockout/Tagout). It was #6 in 2020. We do dozens of projects each year with very large clients, and it is unanimous that if OSHA took even a cursory look at their procedures and training, violations could follow. Conducting lockout, training employees, writing procedures for each piece of equipment, and inspecting the procedures each year is required.
One reason more enforcement doesn’t occur is that OSHA is a very small agency. Inspections fell drastically in 2020 due to the pandemic. In 2019, over 33,000 inspections were conducted. This dropped to under 22,000 in 2020. In early 2021, the Department of Labor Office of Inspector General called OSHA out on this reduction, and everyone agreed that more and deeper inspections were needed. In short, expect more inspections and investigations.
Additionally, in October, Douglas Parker was confirmed as OSHA’s new leader. It bears mentioning that he is a past chief of California’s Division of Occupational Safety and Health (Cal/OSHA). Anyone with experience in California knows the approach taken there to worker health and safety. It is a much more enforcement-focused regulatory scheme. It is likely that some of that scheme will follow Mr. Parker to the Federal OSHA he now leads.
So, the question is, are you ready to go beyond compliance? If you do not have a good feeling about your compliance program, the answer may be “no.” And, if that is the case, what are you risking beyond the health and safety of your workers? If sustainability and ESG performance are what you aspire to, you may be risking investment, growth, and the long-term outlook of your business.
Further Information
As ESG reporting becomes more vital and more publicly transparent, Cornerstone’s industrial health and safety experts can help ensure that your programs and data are ready for the spotlight. Contact us at info@corner-enviro.com or visit our website for more information regarding our ESG services.
John Scifres is Cornerstone’s Director of Health and Safety Services. He is a Certified Hazardous Materials Manager and is a Provisional Lead Auditor for ISO 14001 and OHSAS 18001. He oversees Cornerstone’s team of HHS Project Managers. In addition, he consults with clients nationwide to ensure compliance with Health and Safety regulations and evaluates opportunities to go above and beyond compliance.