Businesses aren’t moral entities. They may be staffed by people who do the right thing more often than not, but that’s because they reflect the make-up of the general population.
Companies exist to turn a profit and their executive directors in particular are appointed with the primary duty to generate shareholder value.
It’s a powerful imperative and it can occasionally push them to act in ways that are not in the best interests of their employees, customers or the rest of society, though corporate statute insists they bear all three in mind. That’s why businesses are hedged round in most jurisdictions with regulations that aim to counterbalance the profit motive with sanctions for everything from price fixing and false product claims to dumping noxious materials and skimping on personal protective equipment for their workforces.
It can be hard to persuade even wellmeaning senior executives to dedicate time and money to issues they do not see as contributing positively to the bottom line that is their key performance indicator. And the OSH profession is only beginning systematically to gather evidence that good safety and health management correlates with higher financial returns.
Jennifer Lunt, Mike Webster and Malcolm Staves’ article in this issue offers some alternative routes to an executive’s heart. (Board engagement is a topic that we’ll return to in IOSH Magazine because it’s a pinch point for so many practitioners who depend on directors for funding and approval.)
Some of their suggestions that involve appealing to board members’ self interest or even vanity may appear to verge on the Machiavellian; in fact they reflect the authors’ experience of how strong the other claims on directors’ attention and effort can be. IOSH’s executive director of policy Shelley Frost notes in her column this month that some organisations are beginning to estimate the value that comes from incorporating worker protection into broader sustainable business models.
Many are not (yet) so enlightened and OSH practitioners in the rest of industry have to gain traction with their seniors where they can.
For those in England and Wales, there may be some comfort in the fact that the traditional compliance argument they have probably relied on has suddenly gained weight.
The galvanising effect of the new sentencing guidelines has been for courts to start handing down six-figure penalties for corporate safety failings at a frequency that once seemed impossible.
If fines continue at this level, directors perception of the increased risk of an unpredictable and uninsurable dent in a year’s profits could translate into less need for sophistry on the part of OSH managers in seeking the respect and resources they deserve.