Global EHS Managers trying to keep abreast of their EHS risk exposure at global facilities tend to use self-inspections and/or third-party compliance audits as the means to gather information and gauge compliance. Unfortunately there are pitfalls with both options, and I wanted a better solution for my clients.
Recently I looked at data from global companies I work with that use both self-assessment program and periodic external EHS audit programs to manage their overall EHS risk to see what the trends in the data could tell me about the quality of data coming from the audit programs.
Feeling the Squeeze: Data Reliability Issues
With less money allocated to managing EHS programs, but still lots of work to be done to keep the company running safely and in compliance with local regulations, EHS managers are in a tight spot. Additionally, sites are undergoing supplier audits, insurance audits, ISO audits, and so forth, and annual self-audits and/or corporate external audits are leading to frustration and fatigue for local EHS personnel. This leads to suspect results.
Monitoring a 90+ facility self-audit event this year, I noted over 82% of the sites completed a 249 question survey event in less than 1 business day – which means that the EHS manager spent less than ½ a minute on reviewing and answering each question. In the past 7 years, we have seen the old formula of 50,000 sq. ft. of manufacturing facility being equal to an audit day become 175,000 sq. ft equaling an audit day. The team-building portion of the exercise and the value-add of being able to look for solutions of identified issues are lost in compressing external audits.
How Reliable is Self-Assessment, Really?
Looking at self-assessment results over time also gives rise to questions about data validity. Companies that use the same set of questions year over year do see the number of self-reported findings drop dramatically--on average, the change between year one and year two was a 30% reduction in the number of findings, and by the end of year five of the same protocol there were 68% less self-reported findings. This looks great as a metric, until you look at the external audit program results in comparison. External auditors using the same self-audit protocol, noted on average 45% more findings, with higher levels of risk.
However, as you might expect, the number of self-reported findings does not show dramatic decline when results are linked to EHS program funding. The need to document noncompliance to obtain budgets competes with the concern about not showing EHS program maturation progress and the results are suspect. External audits of these facilities tend to find similar issues, but not the same risk ranking—about 25% of the external audit findings for facilities in this type budgeting situation were found to be given a higher risk rank than what the site reported.
For the clients who change their self-protocol each year, there was more consistent reporting of noncompliance by facilities. External audits of these sites using limited, changing-scope self-assessment programs noted EHS topics not covered by the self-assessment typically are the bulk of the findings (in some cases resulting in more than 40% increase in the total number of noncompliance findings) and new EHS regulations were typically the most consistent finding of noncompliance. This suggests either that if the EHS topic is not in the self-assessment, local managers may not give it as much attention or that the facility level of expertise on EHS regulations may need to be improved.
Finally, as would be expected, external audits have more findings related to local regulations than corporate policy in all the data sets reviewed. This does not bode well for using self-assessment as a metric of compliance.
The Best of Both Worlds
It was while thinking about these issues that our team started looking for a different way to get reliable indicators of compliance and risk management for global regional and corporate EHS managers. The goal was to get better information in order to demonstrate how external auditing budgets should be spent and what tools and resources provided at the corporate level would close more EHS compliance gaps globally. The result was EHS FleX.
The concept was designed by expert auditors and tested at a number of global corporations prior to release. Facilities still have to respond to a survey, but they also submit relevant supporting materials (photos, permits, chemical logs etc.) to an in-country consultant. This local expert then works through their answers, so site personnel can better understand the local regulations and requirements, identify gaps in compliance, and compile all the necessary information for regional and corporate EHS managers quickly and consistently. This process allows us to risk rank the company’s facilities, which has been found to be highly desirable and very useful for companies integrating new acquisitions.
Feedback from clients using the EHS FleX process and tools is that our global team gives personal support to facilities to ensure that the data gathered is reliable. We have essentially created an augmented self-assessment that is low-cost but high-value, combining some of the best features of external audits with the internal auditing process. Facilities have an outside expert providing EHS support for their complex EHS programs, and the consultants working with the sites can quickly point them to tools and resources that the company may already have invested in that the site was unaware of.
Towards Stronger EHS Data (and Culture)
The goal of assessment must always be to foster a strong EHS culture, which is critical to the long term success of EHS programs. We feel we have made a significant stride in improving that process and obtaining higher quality data (while also staying within budget constraints) with EHS FleX.
To learn more about EHS Flex, check out our video or contact us to talk more specifically about your company’s needs.
