of progress in improving safety and health. The former is
hardly ever true; the latter, all too frequently.
Just think about the oil and gas industry, an immensely profitable industry whose top five companies
had more than $1 trillion in profits in the past decade.
From 1974 to 2013, the 100 largest losses in the hydrocarbon industry topped $34 billion, according to a
new publication by insurance broker Marsh.
Those big losses from process safety incidents don’t begin to offer a complete picture. “In reality, the financial loss is
even greater with 10,000 incidents recorded by Marsh over
the past 40 years,” noted Andrew Furlong, director of policy
and communications with the Institution of Chemical
Engineers. Spin the safety roulette wheel enough times and
these small failures eventually result in catastrophe.
Heading Marsh’s list was the Piper Alpha disaster in
the North Sea, which had an estimated loss of $1.8 billion. On July 6, 1988, the oil and gas production platform
exploded, killing 167 workers. Reading about reports on
the disaster, the elements leading to the explosion sound
hauntingly familiar to occupational safety experts—a
facility not operating according to its original specifications, production continuing while equipment upgrades
and maintenance were being performed, poor planning
that did not factor in the impact of facility changes on
safety systems. Does any of that sound like an actual lack
of money or was it tragic short-sightedness?
Ultimately, it is the governing force of a company’s
culture and ethics, not money, that determines safety performance. So it should come as no surprise that when you
look through the 2014 list of the World’s Most Ethical
Companies by the Ethisphere Institute, you find a heavy
emphasis on workplace safety.
“We believe that in the
long term, it costs compa-
nies less to be safe but we
don’t do it because it costs
less,” Joe Salley, the CEO
of Milliken & Co., told me recently. Milliken is one of
seven companies that have won the ethics award each
year since its inception in 2007. “We do it because we care
about and respect our associates, our customers and the
world that we share.” Q
in 2012, the latest year for which we have data, there were 502,800 nonfatal injuries and illnesses in a U.S.
manufacturing workforce of 11,268,906—a rate just
under one per minute. According to the U.S. Bureau of
Labor Statistics, 314 manufacturing employees died in
work-related incidents that year.
If you say that is too many, you would be right. But
20 years ago, there were 2,232,600 nonfatal injuries
and illnesses in manufacturing. In 1994, the manufacturing population was much larger— 18,321,000. That
year, 789 workers died in manufacturing from occupational injuries. So in less than 20 years, the injury rate
in manufacturing has been cut by about two-thirds
and the fatality rate almost in half.
What accounts for this improvement in safety? Some
is due to the changing manufacturing environment.
Many plants today are cleaner, brighter, better organized
and more automated than they were 20 years ago. Thousands and thousands of kaizens each year have resulted
not just in more efficient plants but also safer ones.
But much of this improvement may also be due to
changes in attitudes about workplace safety, according
to a global survey of more than 3,860 professionals
by DNV GL, a leading certification firm. Companies
are shifting “from a reactive attitude to a conscious
management of operational issues, a prelude to the
development of a real corporate culture of occupational health & safety,” DNV found.
More than 90% of the business managers surveyed
said managing health and safety had become an integrated part of their corporate culture. Just over three out
of four surveyed said their company went beyond the
requirements of government laws and regulations. While
more extensive safety management was more prevalent
among larger companies, 70% of the small businesses said
they take additional actions to improve safety.
The DNV survey shows a predilection for focusing
on operational issues rather than a more strategic view of
safety. Asked about the most effective actions they could
take, 48% cited regular site maintenance while only 37%
picked assessment of all safety and health risks.
Lack of financial resources (31%) and focus on short-term results (26%) were the main reasons given for a lack
workplace safety: small Failures
and the occasional catastrophe
What makes a manufacturing leader these days? To the list of flexible, innovative
and efficient, be sure to add ethical and safe.
For more on safety in manufacturing, visit IW.com/opera-tions/safety.
90% of the
part of their