Making Companies Safe - what works? (CCA ... - Unite the Union

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Chapter One: The Evidence The HSC stated its new “2010 and beyond” strategy that: “We do not see new regulation as the automatic response to new issues or changing circumstances” 1 , although it does go on to say that the HSC will “continue to press for higher fines, a new law on corporate killing and the removal of Crown Immunity.” The reluctance to use law as a means of regulation appears to mark a shift from June 2000 when the Health and Safety Commission (HSC) and Department of Employment, Transport and the Regions (DETR) issued their joint strategy statement Revitalising Health and Safety. In this document they undertook to introduce new law on a number of issues including: sentencing for Occupational Health and Safety (OHS) offences, 2 the imposition of legally binding safety duties on company directors, 3 the removal of Crown Immunity, 4 the harmonisation of workers’ rights to consultation and involvement, 5 and the strengthening of employers’ duties to rehabilitate where appropriate. 6 As of July 2004 the HSC and Government had failed to meet any of these legislative commitments and have made explicit their intention not to introduce legislation on workers’ rights or directors duties. HSC and Government commitments to introduce legislation imposing legal safety obligations on directors 7 were abandoned by the HSC in 2003. 8 And earlier proposals to strengthen and extend employee rights to participation and consultation 9 have been replaced by a statement in which HSC/E indicate that they will encourage the voluntary expansion of workplace health and safety representatives. 10 This met with the approval of the CBI, which claims that HSC has recognised that: “The case for further legislation as a motivator for higher standards of health and safety… has not been, nor is it likely to be made.” 11 However, the question as to whether or not further legislation can be a motivator for higher standards is an empirical – not a political - question that can only be answered by reference to the existing research and not by simple assertion. Review of the International Research In a report for the Australian Occupational Health and Safety Commission, Gunningham reviews the international literature and concludes: “There is very considerable evidence that the single most important driver of improved performance, whether in respect of OHS, environment protection, or affirmative action, is regulation.” 12 Similarly, O’Dea and Flin (2003) state that their review of the literature on corporate governance of safety provides support for: “the notion that the motivation to achieve good health and safety standards are linked primarily with regulatory requirements and that government regulations are necessary in order to protect employees against excessive levels of workplace risk”. In contrast to this, there is growing evidence from both academic research and from research undertaken by non-governmental organisations (NGOs) that ‘voluntarism’ – that is, corporate 19
self-regulation through the adoption of codes of conduct or ‘corporate social responsibility’ initiatives 13 – is largely ineffective in bringing about improved standards of health, safety or environmental performance. For instance, in a wide-ranging review of the regulation of workplace safety in 1999, Gunningham and Johnstone find “significant evidence of the limits of voluntarism”. 14 In particular, one major study on environmental protection from the Netherlands found that companies were not motivated to introduce safety management systems until legislation had been put in place. Wright observes in relation to these findings that, “there is a cost-benefit argument that legislation is needed to encourage systematic management and that more broadly… there is evidence of mandatory requirements being effective”. 15 Recent research by the OECD on the effectiveness of voluntary approaches for environmental policy concluded that the environmental effectiveness of voluntary approaches is often questionable, and that their economic efficiency is generally low. The researchers found that it was highly unlikely that most of the voluntary approaches contributed much to emission reductions and that achievements often did not exceed a ‘business as usual’ scenario, except in those cases where ‘credible threats’ were incorporated into the approach if targets were not met. The researchers also found that combining voluntary approaches with other types of instruments (for example, permitting systems, subsidies, related taxes and charges and emission trading systems) tended to weaken the effectiveness of the latter instruments. In other words, where participation in emissions trading systems, for example, was voluntary many businesses chose not to ‘opt-in’ to the schemes. 16 Further support for the importance of law and regulation in bringing about real changes in corporate behaviour comes from the experience and research of NGOs, labour rights activists and trade unions. NGOs were instrumental in getting multinational companies to adopt voluntary workplace codes of conduct. However, many human rights NGOs are increasingly realising the limitations of both voluntary codes of conduct and ‘corporate social responsibility’ initiatives in national and international contexts. A number of case studies have shown that Corporate Social Responsibility (CSR) programmes adopted by multi-national and transnational corporations have not brought any tangible benefits to the workers and communities adversely affected by their operations. 17 Similarly, the experience of workers in developing countries is that many companies are simply failing to properly implement their codes of conduct within individual workplaces, and that workers are wholly unable to protect their rights in the absence of the possibility either of legal/ state enforcement or of trade union enforcement and organising structures. 18 Thus, one observer has commented: “We have put too much emphasis on codes and probably too much emphasis on voluntary enforcement. It is untenable to expect companies to enforce their codes voluntarily.” 19 As a consequence of these failures, and as observed in a recent letter to Patricia Hewitt signed by more than 20 leading charities in the UK: “CSR is coming under growing attack from different quarters on the basis that it is not delivering results. Recent reports from think tanks and civil society organisations call into question the effectiveness of existing initiatives”. 20 20 One example of this is research published in March 2004 by the consultancy Article 13. It said that less than 3 per cent of FTSE 350 firms have acted seriously on challenges such as climate change, waste and poverty. 21 Another example is the chemical industry’s ‘Responsible Care’ program - a voluntary self-regulatory program set up by the industry in response to a loss of public confidence in the US chemicals sector. The stated aim of the program is to: “reduce chemical accidents and pollution, [and] to build public confidence through improved performance, continuous improvement and increased communication.” 22 However, research in the early 1990s demonstrated that firms which relied on Responsible Care alone did not achieve better environmental performance. 23 And more recently, research in the US has shown that the number of chemical ‘accidents’ each year (including worker fatalities and
Page 1 and 2: Making companies safe: What works?
Page 3 and 4: Acknowledgments: Courtney Davis wou
Page 5 and 6: Contents INTRODUCTION 7 MAIN FINDIN
Page 7 and 8: So for example, the new Strategy do
Page 9 and 10: “In recent years, there had been
Page 11 and 12: Chapter eight is a short chapter lo
Page 13 and 14: • The only sector-specific data o
Page 16: PART ONE Legal Regulation v Volunta
Page 21 and 22: • A number of studies evaluating
Page 23 and 24: Gap in the law Yet despite the impo
Page 25 and 26: By September 2002 the Government ha
Page 27 and 28: Conclusion In conclusion, the Green
Page 29 and 30: effectiveness of safety representat
Page 32 and 33: Chapter Four Conclusion There is ve
Page 34: PARTS TWO & THREE Strategies to sec
Page 37 and 38: A recent HSE discussion paper illus
Page 40 and 41: Chapter Five The Health and Safety
Page 42 and 43: Support for these findings comes fr
Page 44 and 45: Gray and Scholz attempt to understa
Page 46 and 47: perceived low level of current fine
Page 48 and 49: Chapter Six The Implications for th
Page 50 and 51: five times greater than if one had
Page 52: Select Committee on Work and Pensio
Page 56: The evidence reviewed in part two s
Page 59 and 60: health risk management between “a
Page 61 and 62: The relationship between knowledge
Page 63 and 64: Conclusion Whatever factors prompt
Page 65 and 66: 16 This was at an aggregate level.
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- the year that the initiative was
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When safety does not pay (or does n
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Similarly, firms might make an econ
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However, even in the context of mul
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does, exert a negative influence on
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to cost “a little” or “nothin
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For instance, when BP Grangemouth r
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Chapter Ten ‘Earned Autonomy’ T
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A similar experiment in self-regula
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Whilst the original focus of TQM wa
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“the more firms incorporate ethic
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“In Norway the mandated model is
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odies, pressure groups and/or the m
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Health and Safety Management System
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Gunningham and Johnstone argue that
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Conclusion Proposals that some comp
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37 The Norwegian Internal Control R
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PART FOUR Conclusion 103
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Chapter Eleven Conclusion The Healt
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Appendix Select Committee on Work a
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References Alder A., Tipping A. and
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Health and Well-Being’, in Frick
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Honey S., Hillage J. et al. (1997)
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Nichols T. and Armstrong P. (1973)
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Wokutch R.E. and VanSandt C.V. (200
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