The Short Conference: “Risk vs. Compliance” Panel Discussion – A Summary
Posted on May 17, 2021 | in Operational Risk
Managing compliance and risk can be seen as opposites, ripe for contrast. The reality is more nuanced; compliance is more tactical while risk management is more strategic. But, according to our experts at The Short Conference last week, the most effective approach is one that aligns compliance with risk and tactics with strategy. In this faced-paced session, moderated by Rick Barker, Principal Solutions Strategist for VelocityEHS, three experts had 90 seconds each to answer specific questions on managing compliance and risk. The expert panel included:
• Alex Apostolou, Principal Solutions Strategist, VelocityEHS
• Jules Hinske, North America Process Safety Manager, Unilever
• Frank Skiba, Sr. Product Manager, Audit & Compliance, VelocityEHS
To keep things “short,” here’s a quick-read summary of their collective responses to the questions posed.
What are the benefits of a compliance-based approach?
- Creates a level playing field
- Provides clarity of process
- Helps less-experienced operators
- Helps you avoid penalties
- Creates a strong foundation that frees you up to do more
- It’s important to the public at large
What are the limitations of a compliance-based approach?
- Isn’t efficient in reducing risk and incidence
- Can’t always understand where risk is highest (and where you can get the most bang for your buck)
- Missing the ability to focus on trends
What are the benefits of a risk-based approach?
- Focused on outcomes
- Helps you actively understand risk and the process better (the why)
- Appeals to behavioral safety aspects
- Provides a “freedom” to assess and control
- Allows for more informed decisions and engagement with others
- Aligns EHS with business outcomes
What are the limitations of a risk-based approach?
- It’s really about managing the controls that manage risk (“You need an engine for the car.”)
- In inexperienced hands, risk processes can wander
- Need to be able to switch your lens for your specific environment/situation
What are some effective methods used to manage risk?
- Conduct audit, to identify systemic issues and recognize similar hazards across locations
- Use a management system
- Solve the problems that you don’t know the answers to
- Use the knowledge that already exists (you don’t always have to start from scratch)
- Create a set of lessons the company can abide by
How do you help senior leadership understand what risk is?
- Build a business case
- Keep it simple, focus on critical drivers, involve them (they need to walk the talk)
- Get them to talk to other leaders in similar companies that use a risk-based approach
- “Risk” can be subjective, but severity and likelihood can be quantified
- “Tolerable risk” is different in different industries
To view the on-demand recording of this session, visit the The Short Conference landing page.