It should be obvious staff have the right to expect employers to provide a
safe and healthy environment but a growing body of research shows that health
and safety is one of the most overlooked aspects in the workplace. This neglect
causes untold damage to people and property, not to mention serious accidents,
some of which are fatal.
The facts are startling. More than 35 million days are lost each year to
occupational ill-health and injury, costing the UK economy an estimated £1bn.
Last year more than 200 people were killed at work and more than 350,000
These deaths and injuries are largely the result of poor health and safety
management. Most accidents and fatalities are completely avoidable, often by
implementing simple, inexpensive measures, according to experts. Health and
safety is crucial in reducing this burden, preventing work-related illness and
injury, and improving rehabilitation and return-to-work support.
In May, leading lights in industry, government and other key stakeholders
from the public and private sectors signed a charter committing their
organisations to deliver a healthier future for people at work.
Vital to the Health and Safety Executive’s strategy is a new service,
Workplace Health Connect, for small and medium-sized companies.
Jonathan Rees, deputy chief executive (policy) of the Health and Safety
Executive, says: ‘This is an ambitious programme that requires sustained
commitment, genuine partnership and action by all.
A successful strategy will mean more people at work for more of the time,
those with health conditions and disabilities able to optimise work
opportunities, and reduced health inequalities and social exclusion.’
Intentions and pronouncements are all well and good, but who will ensure that
organisations put policies in place to protect their workforce from avoidable
accidents and adhere to those policies? Step up the auditor.
The overall profile of health and safety at work has grown substantially in
recent years. This fits with a sharper focus by shareholders and other
stakeholders on how the corporate world’s business activities affect its
surroundings socially and environmentally.
Auditors’ skills in this area are essential as business has become slowly,
but increasingly, more risk-averse as a direct result of the corporate scandals
of the last five years. Companies now focus more keenly on risk assessment, and
auditors are best placed to define risk and advise on how to mitigate it.
‘Increasingly, companies will require outside verification due to growing
demand,’ says Rebecca Graham, manager in KPMG’s health and safety audit unit.
‘Stakeholders want it, and often in tendering processes some companies want
to see third-party accreditation. It’s driven by the market.’
Between 1990 and early 2000 health and safety issues were a component of
corporate reporting of non-financial data, but only a small part. It is really
in the past few years, driven by the threat of having to face corporate
manslaughter charges, that companies have really grasped the nettle.
‘It’s really important, and people are beginning to recognise this in
business,’ says Graham. ‘It improves efficiency and reduces accidents. The wider
benefits include making an organisation smarter and slicker, as well as reducing
lost industry and employee time.’
Indeed, in the oil and construction industries there is a direct reporting
line to the board for health and safety issues.
Geoff Lane, partner in PricewaterhouseCoopers, says: ‘Health and safety is
going back up the agenda and is becoming a big issue for boards.’
Auditors have no obligation to comment externally on poor health and safety
policies at companies they visit, unless there is an issue that would
substantially affect the financial statements. Auditors don’t have to sign off
the data, as they do in a normal audit.
Proposals in the Operating and Financial Review, unilaterally scrapped by the
chancellor, would have strengthened the auditor’s hand in this area by obliging
companies to report on that information if it was deemed material to the company
or sector, as it is in the oil industry.
Now that the requirement to include an OFR has been dropped, it will be
interesting to see if companies continue to include one, and whether they choose
to make statements on their health and safety processes. More interesting,
however, will be whether companies choose to have this information externally
‘Corporate social responsibility reporting is now expected,’ says Lane. ‘And
assurance is increasingly expected. What format that takes is debatable. The
challenges will be around the inherent limitations of reporting.’
Currently, auditors still play an emerging role in this field but their
expertise in assessing financial as well as non-financial information will begin
to have greater influence as stakeholders demand information and the public
begin to rely on auditors’ judgements.
RECORDING RISK ASSESMENTS
You should keep detailed records of any risk assessments carried out. Your
records must show that:
• A comprehensive assessment, using specialist help where appropriate h as
been carried out
• All the obvious significant hazards have been dealt with
• Reasonable precautions have been put in place to ensure that the remaining
risk is acceptably low
Your records can include cross-references to other documents, such as your
company’s manuals and health and safety procedures. While companies aren’t
required to keep written records of risk assessments, it is still a good idea
for all businesses to do so, even those with fewer than five employees to do so.
For more help or advice, go to the Health and Safety Executive’s website at
The HSE and local authorities will work constructively with companies to try
to improve standards. You can also call the HSE’s confidential information line
for advice, without having to disclose who you are (08701 545500).
The Institute of Directors also offers sound advice and an array of briefing
notes with useful advice on company directors’ duties and obligations.
OIL COMPANIES LIGHT THE WAY
In its annual report for 2005, under its OFR section Shell reported the
‘Internal audit operates a business control incident reporting procedure, the
results of which are reported to the Executive Committee and to the Audit
Additionally, incidents or compliance issues relating to other standards, for
example on health, safety and environmental are identified, investigated and
their learnings shared. They report significant non-compliance to senior
executives and to the relevant function head.’
It made no statement as to whether this information had been externally
And the BP website contains a ‘verification’ section which includes a
statement dated April 2004 from Ernst &Young confirming that it had
‘assessed’ BP’s health and safety reports.
‘Reviewed health, safety and environment, community investment, ethics
dismissals and diversity and inclusion (graduate recruitment and group
leadership) data samples and processes to assess whether they have been
collected, consolidated and reported appropriately at the group level.’
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