5 Key Takeaways From SPF Sydney
1) Management Must Be Involved in the Implementation
Attendees discussed how to get the most value from the implementation of an EHS system. Without a successful implementation, it becomes more difficult to encourage user adoption, which impacts the ROI of the purchased EHS software. As part of the implementation, a company needs to transition from autonomous and separate processes to one that is standard and centralized around a single software system. This becomes very challenging, if not impossible, without strong involvement from management. Upper Management’s involvement is critical for the successful implementation of an EHS system. “Involvement” does not mean getting weekly updates or asking questions occasionally. Executives must be actively and visibly involved throughout the implementation, to send a strong signal about the importance of the project. This becomes easier when both Upper Management and the project team have joined forces on establishing the right business case from the start, and agreeing where ROI is best extracted with the implementation.
2) The Value of an EHS System Lies in Leading Indicators
Once an EHS system is successfully implemented, the value that it produces depends on how it is used. Attendees shared the ways in which they use the system to get the most value. For example, one client highlighted the practice of pulling data from other areas (e.g. Finance, Operations) and combining it with data from Enablon in order to increase the predictive power of the system. A common theme emerged from the discussion: the number of tracked leading indicators influences the level of value obtained from an EHS system. As more leading indicators are tracked and analyzed, value is delivered faster, a greater number of incidents are prevented, and more risks are reduced. For example, a client saw a direct relationship between an increase in the number of recorded observations and a decrease in critical incidents.
3) The Role of IT Needs to be Clearly Defined
Many attendees strongly emphasized that the role of IT needs to be clearly defined, throughout the implementation and ongoing use of an EHS or Risk system. This is especially relevant because of the different deployment models available: on-premise, SaaS, or software owned by a company but hosted by the vendor. While IT likes to have control over the system, some attendees stressed the need for the business side to drive the use of the system and involve IT only when they are needed, especially if the system is hosted in the cloud. Other attendees were fine with IT taking ownership of the system and performing as many ongoing administrative tasks as possible while other stakeholders just make decisions rather than running the system. Despite the variety of opinions, everyone agreed that clearly defining the role of IT eliminates overlaps, confusion and frustration.
4) CSR Pressures Continue to Grow
When people think about Corporate Social Responsibility (CSR), the elements that come to mind include environmental impacts, health and safety of employees, gender parity, business ethics, social and economic impacts on the community, sustainability performance, etc. Many best-in-class companies have been addressing these in some form over the last few years to protect and enhance brand reputation, attract investor attention, improve stakeholder engagement and drive other benefits. But attendees highlighted a number of other elements that have recently increased CSR pressures for large global brands, such as: the social and environmental performance of suppliers, especially the use of child labor; and the way Social Media brings CSR issues to the attention of a larger public at a much greater speed, thus creating a reputational risk with high velocity.
5) Climate Change is Creating Financial Risks
The agreement reached last December in Paris at COP21 is a clear indication that governments, civil society and all key stakeholders are serious about climate change. Companies have been responding to climate change by reducing greenhouse gas (GHG) emissions and their carbon footprint, along with other strategies. But some attendees highlighted other impacts of climate change on a number of industries, especially oil and gas. With national and global policies increasingly designed to fight climate change, and the emergence of renewables, many firms face financial risks due to stranded assets, i.e. oil, gas and coal reserves that are left in the ground, thus preventing an economic return for the firms exploiting them. Shareholders are increasingly demanding more information from firms about the steps taken to mitigate financial risks resulting from stranded assets.
We hope you found these takeaways interesting. The SPF series now moves across the Pacific to its first stop in North America, where SPF Houston will take place on April 21. Let’s see what interesting insights SPF Houston 2016 will bring!
SPF Americas 2016 will take place on October 4-5 in Chicago, and will bring together more than 500 EHS, Sustainability, Risk and IT professionals from the world’s largest corporations. Register today and don’t miss out on 50+ sessions and countless opportunities to network with your peers.