Currently, new work health and safety (WHS) laws have been enacted in 7 Australian jurisdictions, with only Western Australia and Victoria retaining their existing OHS laws. These new WHS laws introduce a personal duty for ‘officers’ of companies to proactively exercise due diligence to ensure their company is meeting its duties and obligations under the WHS laws.
The introduction of this personal duty is causing many director’s to examine more closely their company’s safety performance. Consequently, many companies are reviewing the WHS information being provided to their board and, more broadly, whether their existing safety governance arrangements meet ‘best practice’.
In the area of safety governance it can be difficult for companies to understand how well their arrangements compare to others, so, in September 2012, Herbert Smith Freehills launched its WHS Board Reporting Survey. The survey examined the safety governance arrangements of 118 organisations and measured these organisation’s arrangements against that required to meet ‘good practice’.
Key findings of the survey are:
- 2 out of 5 of organisations have a board where not all directors have a strong understanding of their legal duties.
- Only 55% of new directors receive a briefing on their WHS safety responsibilities.
- Only 54% of boards have separate (external) WHS auditing or assurance processes.
- Half of boards rely more on injury and incident data than on general deliberations on WHS matters.
- Only 29% of boards receive regular information on the safety culture of their organisation.
These findings highlight that there is still much work to be done on improving the safety governance arrangements necessary to meet ‘good practice and, more critically, those arrangements necessary for directors to meet their personal duty of due diligence under the new WHS laws.
Our report setting out the survey findings can be accessed here.