The Baker Panel Report - ABSA

CORPORATE OVERSIGHTAn effective process safety management system requires significant involvement by an organization’s leaders. As discussed earlier in thisreport, a company’s leaders must establish performance objectives, develop and implement a system to accomplish them, provide thenecessary resources, and then foster a culture in which the system can operate as intended. The final part of the continuous improvement cyclealso requires management involvement. At this point in the cycle, the organization must assess the available indicators of the system’sperformance and evaluate whether the system is functioning as intended. In its 2003 report on best practices in corporate safety and health,the Conference Board cited monitoring performance regularly and providing frequent feedback as one of the core elements of successful safetyand health strategies, as expressed in a survey of senior safety executives from a group of major corporations. 139According to the ANSI Z10 standard for occupational health and safety management systems, the management review process should includeconsideration of the following eight inputs: progress in the reduction of risk; effectiveness of processes to identify, assess, and prioritize risk and system deficiencies; effectiveness in addressing underlying causes of risks and system deficiencies; input from employees and employee representatives; status of corrective and preventive actions and changing circumstances; follow-up actions from system audits and previous management reviews; the extent to which objectives have been met; and the performance of the system relative to expectations, taking into consideration changing circumstances, resource needs,alignment of the business plan, and consistency with policy. 140The related commentary to the ANSI Z10 standard provides a useful description of the role of and purpose for management reviews:Management reviews are a critical part of the continual improvement of the [safety management system]. The purposeof reviews is for top management, with the participation of [safety management system] leaders and process owners, todo a strategic and critical evaluation of the performance of the [safety management system], and to recommendimprovements. This review is not just a presentation or a non-critical review of the system, but should focus on resultsand opportunities for continual improvement. It is up to the organization to determine appropriate measures of [safetymanagement system] effectiveness. They should also evaluate how well the [safety management system] is integratedwith other business management systems, so it supports both health and safety goals and business needs andstrategies.Reviews by top management are required because they have the authority to make the necessary decisions aboutactions and resources, although it may also be appropriate to include other employee and management levels in theprocess. To be effective, the review process should ensure that the necessary information is available for topmanagement to evaluate the continuing suitability, adequacy, and effectiveness of the [safety management system]. . . .Reviews should present results (for example a scorecard) to focus top management on the [safety management system]elements most in need [of] their attention ....At the conclusions of the reviews, top management should make decisions, give direction, and commit resources toimplement the decisions. The management review should include an assessment of the current [safety managementsystem] to address if the system is encompassing all of the risks to which the organization is exposed. This portion of thereview should include a review of major risk exposures and ask the question, “Are there any holes” in the current [safetymanagement system] that could allow a risk that might not be considered within the [safety management system]. 141Performance Evaluation, Corrective Action, and Corporate Oversight C 225