President's Update 17/3/20

Kia ora koutou to all members and supporters of NZISM. The last couple of weeks has seen a flurry of political and media activity around health and safety and it’s hard to know whether this attention is beneficial or not. Prior to the introduction of the Health and Safety at Work Act there was commentary about the lack of focus in mainstream media about health and safety. The only time we got to hear about it was when there was a disaster, I am not sure what’s changed.

Health and safety is certainly more front and center in the media and it’s not all about death and injury, yes there are some positive stories that do come out from time to time. The grandstanding we have seen recently shows to me the absolute lack of understanding and knowledge that our politicians and the media have about keeping people safe at work by trotting out the “common sense” phrase. I guess in their defence, it gets people talking. Unfortunately, it seems to drag out everyone that has a story that creates myths about things like engineering certificates being required for saw-horses, and other nonsense.

The statements made recently by the leader of the National Party are not new, members who attended the Southland Safety Show in Invercargill back in November 2019 will recall Nationals Associate Minister for Workplace Safety making the exact same announcement, that regulation was going to be culled on the back of safety being too onerous for small business. Recent research by the New Zealand Institute of Economic Research (NZIER) shows that workplace safety plans have had a positive impact on businesses – the report states “Business response to health and safety (H&S) has been a main highlight in conversations with business. All the businesses we spoke with felt H&S has improved business performance, a result supported by the BOS. H&S has been used as a competitive point of product/service differentiation, with customers choosing to pay higher prices to receive more H&S within their service/product. This is a tangible message about management caring about safety and taking it seriously”

At the same time that this so-called “regulatory bonfire” was being discussed on commercial radio, change frequencies, and we heard about WorkSafe’s lack of investigation into various serious events such as the Sky City fire and concern that the same event had not been formally notified to the regulator. The NZIER report was in alignment with some of this when it found that in general business thought that “WorkSafe is doing a good job but is under-resourced for the task”

We all know that New Zealand's health and safety performance remains wanting, however, the growing understanding about its importance and the current high-profile debate is placing more emphasis on its value for people and business performance overall. Ultimately, it is important for all organisations to take responsibility for the health and safety of their workforce simply because it makes business sense.

I want to change tact for a moment and talk about the open letter from Blackrock’s CEO Larry Fink, in which Fink’s aim is to provide guidance to CEO’s globally and promote long term value. In the 2020 version of his letter https://www.blackrock.com/corporate/investor-relations/larry-fink-ceo-letter, Fink focusses on Climate Risk and Purpose. In terms of Purpose, he states that “a company cannot achieve long-term profits without embracing purpose and considering the needs of a broad range of stakeholders”. These stakeholders absolutely include workers and the duty owed by organisations around safety. Ultimately, Fink states, “purpose is the engine of long-term profitability”

To me Organisational Purpose and the understanding of this Purpose by workers is also the driver of improved culture and workers level of engagement with the business including health and safety. I have spoken before about the stories of “JFK and the Janitor” and “Being Christopher Wren” If you are not familiar with these stories, look them up on google. If workers understand Purpose this leads to a range of positive cognitive and behavioural outcomes.

In a similar vein, I recently attended an Institute of Directors event to hear Richard Smith-Bingham from Marsh and McLennan UK discuss highlights from the World Economic Forum Global Risks Report. Three areas focussed on were Political Risks, Technology Risks and Environmental Risks. At a very high level in terms of health and safety of workers, there were links across all of these aspects. With the current political landscape seeing companies as collateral damage, contributing to increased employee stress and activism, technical risks introducing general workforce challenges such as ethical approaches to AI and environmental risks creating intense pressure from multiple directions introducing issues around Environmental, Social & Governance (ESG).

While it wasn’t covered in the Smith-Bingham presentation, of course there is also mention of global health risks, with the report suggesting that global health systems are no longer fit for purpose. Interesting to note that non-communicable diseases such as cardiovascular disease and mental illness has taken over from infectious diseases as the leading cause of death globally.

The final message out of the presentation was really about a sharpening of tensions between different mindsets of Value and Visionary. At a risk level with a Value mindset the focus is on familiar and manageable risks, heat maps, process rigour and risk optimisation, conversely a Visionary approach to risk considers complex uncertainties and new threats, scenario-based testing, leadership education and strategic resilience.

What type of mindset has your employer got?

Ngā mihi mahana

Greg Dearsly

President