International Study: Governance Failing NZ Workplace Safety

An analysis of health and safety data from more than 2,600 companies across three countries reveals significant leadership failures at governance and executive management levels may be contributing to New Zealand's failure to reduce workplace incident rates to better match Australia and the United Kingdom.

Insights from the Safe365 Safety Culture Maturity Report 2024—the first of its kind to analyse the current maturity of safety culture in New Zealand, Australia, and the United Kingdom—found that lack of director and manager knowledge is holding safety culture maturity back, particularly in New Zealand.

Overall, the report found that director and management knowledge of risk management practice and the depth of awareness around their own industry-specific safety landscape falls short of what is needed, scoring 48% in maturity for director knowledge and 46.3% for manager knowledge.

Nathan Hight, co-founder and managing director of the New Zealand-owned and operated health and safety tech platform, Safe365, says there is a systemic issue with the level of director knowledge regarding good governance within organisations.

This includes a lack of the necessary understanding to effectively question and account for organisational spending, compliance with management practices and whether or not we’re focused on the right areas to truly impact worker safety.

"Nobody is questioning the best intentions of senior leadership, nor are we suggesting indifference, but rather a lack of understanding of effective governance of work health, safety and well-being.

"The solutions are often not complex. Directors need to be equipped with the knowledge to ask good questions that check and challenge senior management, and to exercise visible leadership on health, safety and well-being within the business and, importantly, possess a willingness to address and solve these problems."

Hight says directors and senior management need visibility into effective insights, including risk assessments, incident reporting, compliance monitoring, and safety audits. Such data can help them offer oversight and leadership that leads to better workplace risk management, incident reduction, and regulatory compliance–but that’s not enough either.

"There is a prevalent assumption that meeting legal compliance obligations with health and safety regulation equates to safe outcomes for workers. Company directors and senior management need to realise that regulatory compliance represents the minimum viable threshold and does not necessarily reflect a comprehensive safety picture.

"Unfortunately, health and safety training is often focused on meeting compliance requirements, which does not reflect the systemic changes needed in the profession.”

Hight says it is imperative that organisations invest in training and developing their directors, senior management and even safety professionals to meet modern governance and safety standards so that the senior leadership can look beyond compliance requirements and instead strive for excellence in leadership and accountability.

Recent prosecutions of board members and senior management for health and safety failures, including the former chief executive of Ports of Auckland Limited (POAL), Whakaari Management Limited (WML), and Whangārei Boys' High School's Board of Trustees (WBHS BOT), are unlikely to improve outcomes.

Hight says that prosecutions are unlikely to change behaviour because the current plateau in harm statistics, despite increasing regulations, points to a compliance-focused approach that is creating a culture of complacency and failing to make workplaces safer.

"However, demonstrating the business value in health and safety might (change behaviour). For example, if insurance companies (including ACC) take greater steps to reward proactive organisations with better insurance terms and benefits, such as risk management rebates, instead of generally treating them all the same."

Alongside the need for stronger management and director knowledge, the report shows that, while systems and processes are in place to tackle potential risks or incidents, verification that these risk management practices are actually in place and performing as intended is inconsistent due to low levels in internal audit and verification maturity. In other words, in the absence of proper assurance, many companies are operating under the illusion of safety, and as a result, we will continue to see preventable harm continue.

“Workers and/or contractors that role-model best practices in health and safety are usually only informally recognised.

"This report is a reminder that a true safety culture goes beyond compliance and requires a commitment to continuous improvement and excellence in leadership, accountability and organisation-wide engagement in safety outcomes, leading to reduced harm and improved overall business performance," says Hight.

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