Briefing the Boardroom on Safety

SLC 2016: Briefing the Boardroom on Safety

Sept. 23, 2016
“Your C-suite is used to the concept of risk,” Kathy Seabrook explained at the 2016 Safety Leadership Conference. “However EHS comes from a viewpoint of hazard. We need to view our domain as risk, since health is a risk, and it's risk that gets the attention of the board.”

While safety has always had an impact on the bottom line, from a variety of angles, safety professionals have not always had a voice in the boardroom.

Part of the problem, according to Kathy Seabrook, president of Global Solutions Inc., is how safety professionals use language. “Your C-suite is used to the concept of risk,” Seabrook explained during a session in the Compliance Track at the 2016 Safety Leadership Conference. “However EHS comes from a viewpoint of hazard. We need to view our domain as risk as it's risk that gets the attention of the board.”

Seabrook suggests positioning the health and safety function in terms of materiality.  This concept, which means information necessary to make a sound decision, is embedded in the investment community, and is thus an important tool in any executive suite. Safety professionals should be talking about how human capital is material to the organization.  In fact Seabrook points out that studies show that a company is only able to capture 70% of an employee’s capability and strives to capture the other 30%.

It’s these types of statistics that the board is focusing on, said Steve Davis, president of GRM Inc. at the conference.  “The board is looking at financial performance as measured by KPI,” Davis explained. “I tell safety folks they need to understand the business functions of the company and be able to speak to that.”

And risk is something that needs to be communicated. Looking at the next few months Davis mentioned a few risk:

  1. Election -- Business will be affected based on the regulatory environment. He tells safety profession to educate senior management on the regulatory issue sin the U.S. as well as Europe and the Pacific Rim.
  2. Terrorism – How will this affect the operations of your company? Have you communicated this to your senior management team?
  3. Violence in the Workplace – A growing problem that must be addressed with specific policies and procedures.
  4. Changing business climate – Mergers and divestitures can have profound effects on the organization.

Other risks that might be overlooked but are essential to the health of the company is that of its reputation in the market. And often it’s the safety element, via an OSHA incident, that can forever change the market’s view, and financial viability of the company.

“If you do your job right you are a non-issue for your company,” says Davis. “A company doesn’t often realize how important tending to health and safety issues is. Having a safety problem can cost a company its reputation and life.”

About the Author

Adrienne Selko | Senior Editor

Email [email protected]


Adrienne Selko is also the senior editor at Material Handling and Logistics and is a former editor of IndustryWeek. 




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