New Health And Safety Guide: Good Governance For Directors

The Institute of Directors (IoD) and WorkSafe New Zealand have published an updated version of their ‘Health and Safety Guide: Good Governance for Directors’ yesterday.

The new guidance is provided across three documents: Health & Safety Governance – Guide; Health & Safety Governance – QuickGuide; Health & Safety Governance – Self Assessment.

In this alert we set out some initial comments on the key changes and our view on the importance of up-to-date and comprehensive guidance in this area generally.

A link to the guidance documents is available here.

Who should read this advice? Why?

In short, all directors and other ‘officers’ who have health and safety due diligence duties under the Health and Safety at Work Act 2015 (HSWA) should read the updated guide [1].

The original guide (issued in March 2016) has remained a valuable resource but was due for a review and re-fresh. The new guide was developed by the IoD and WorkSafe drawing on good governance practice in New Zealand, including the findings of the Better Health and Safety Governance Project (which you can find here). It intends to provide “a renewed vision, principles and tools for health and safety governance”, shifting the focus from a ‘compliance-based’ culture to one where strong health and safety practice is part of good governance more generally.

What does it cover?

The guide seeks to advise officers on how to deliver better health and safety governance and in doing so achieve better performance outcomes more generally. It places the legal obligations under the HSWA within the broader health and safety context of good governance.

Specifically, the guide provides an outline of the fundamentals of health and safety governance, the vision of good health and safety governance and the behavioural framework required of officers and other leaders to get there. It also outlines a set of health and safety governance principles and provides practical questions for officers to ask and examples of what good looks like.

What is new?

The overarching theme of the new guide is to shift the practice of health and safety governance from a “compliance-focused and rules-based approach” to embrace the role that strong health and safety practice plays in the overarching performance of an organisation more generally.

Key points to note throughout the guide are:

• A clear and updated view of the respective roles of the PCBU, officers, management and health and safety leads within health and safety governance, and how each of the new health and safety governance principles applies to the roles of officers, managers and health and safety leads.
• The development of the five principles to guide health and safety governance while allowing the flexibility to recognise the ecosystem the organisation operates within: learn and develop, anticipate and understand, plan and resource, trust and verify and monitor and respond.
• A recommendation to move away from reporting measures like total recordable injury frequency rates and lost time injury frequency rates and to focus on reporting that is more insightful and that genuinely contribute to safer outcomes. The guide notes ‘good health and safety’ means to “[f]ocus on health and safety performance, and governance reporting about it, should centre on those areas that genuinely contribute to safer outcomes, such as providing enough resources, designing work well, training people, testing key health and safety controls and so on”.
• A focus on providing practical and flexible guidance that centres around three key concepts – “What you need – foundations”, “What you do – principles” and “How you do it – the 5Cs” – to achieve an overall vision of “[c]apable leaders integrating health and safety into curious and courageous governance discussions and decisions, that are context-rich and demonstrate care for workers.”

Our view

While there is lots to digest it is clear the new guide is essential reading.

The HSWA seeks to balance two aims – providing flexibility to respond to different circumstances and providing certainty through detailed requirements. This is reflected in section 44 of the Act, which creates a general duty or obligation on officers of PCBUs to ‘exercise due diligence to ensure that the PCBU complies with’ its obligations under the Act and provides a definition of what due diligence 'includes’. The flexibility can make it difficult for duty-holders, including officers, to understand what is expected of them.

In that context, up-to-date guidance on what ‘good looks like’ (including from the key regulator’s perspective) is essential – both to achieving better health and safety outcomes for workers and to giving officers confidence as to the steps they should be taking to meet their personal obligations under the Act (especially given the Better Health and Safety Governance Project report noted that “there’s a wealth of publicly available governance materials but very little health and safety governance materials adding value”).

If you have any questions about the new guide, or would like assistance reviewing your organisation’s health and safety governance processes, please contact one of our experts.

Footnote

[1] Officer, in relation to a person conducting a business or undertaking (PCBU) (a) means, if the PCBU is (i) a company, any person occupying the position of director of the company by whatever name called; (ii) a partnership (other than a limited partnership), any partner; (iii) a limited partner, any general partner; (iv) a body corporate or an unincorporated body, other than a company, partnership, or limited partnership, any person occupying a position in the body that is comparable with that of a director of a company; and (b) includes any other person occupying a position in relation to the business or undertaking that allows the person to exercise significant influence of the management of the business or undertaking (for example, a chief executive). The new guide simplifies the definition of officer to “[p]eople responsible for governance activities [that] have the influence, control and authority to make decisions that impact the whole organisation.”

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