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Timothy Walker, former Director General, the Health and Safety Executive (HSE)

No chief executive wants their employees to be injured or to have their health damaged at work, although not all do enough to turn their desire into action. But it can be too easy for "health and safety"" to be regarded as a cost rather than a benefit, and for it to be delegated out of sight. The attached sign in a Shanghai park is an illustration. I want to use this article to show the positive advantages of good health and safety and to illustrate the role of a chief executive in providing leadership for this purpose.

This does not mean that I want to devalue the moral case for health and safety. People have a right to expect not to be killed or injured at work; they have a right to expect a lifetime of work will not result in a bad back. Those who are negligent or criminally incompetent should be punished. But avoiding bad performance is not always the same as promoting good performance. Good health and safety is part of being a high performing organisation and is usually a good indicator of how well managed it is.

Sensible health and safety means avoidance of unnecessary costs, whether in damages, lost production, absence of key staff, extra recruitment or a hit to reputation with all that will bring. It is no surprise that a major construction company has found a good correlation between site safety record and site profitability. One chemical company reckons that the benefit to them of having a better health and safety performance than their peers is about US$10m a year. In construction, as elsewhere, clients are increasingly using safety performance as a key criteria in letting contracts.

Let me give two more detailed examples.

A UK polythene film manufacturing company, employing 3,500 people, already had a scheme to reduce the number of cases of workers who had acquired back problems or disorders of the upper limb. They took the further step of supporting workers whose conditions were serious enough to keep them off work.

With the injured person's consent, a physical therapist carried out a visit within 24 to 48 hours and sent a detailed report to the company about the worker's condition. Interestingly, conditions arising from non-work activities were dealt with as well. Appropriate treatment was then obtained through an "osteopaths for industry" scheme.

The evaluation findings speak for themselves. Only 16 per cent of people referred to physiotherapists took time off work. The great majority - 70 per cent of employees - were referred as fit for work, while only 14 per cent were put on restricted duties. The average amount of days lost per worker fell from 26 days absence to four days. The direct cost benefits, estimated over a year, were startling; costs for an average of three treatments for around 130 staff were £16,000, the benefits were £192,000.

The group director of health and safety said: "This rehabilitation scheme created the solutions we needed. It was popular with the workforce and their representatives, and it made excellent business sense". The workers themselves were fully and union health and safety representatives gave considerable support. The CEO and Board were enthusiastic that a new means of supporting staff and reducing business losses had been identified.

In another example, the vehicle services division of the Post Office implemented a comprehensive health and safety management system, which greatly reduced accidents among the 1500 staff. Days lost per employee through accidents and ill health reduced by 40 per cent, equivalent to around £700,000 in savings over five years. Taking the indirect costs into account, including savings from almost halving compensation claims, reduced legal costs, less administration on civil cases, and other indirect costs brought total savings to around £370,000 a year. The key elements were more effective accident investigation, monitoring of safety improvements as a result of investigations, and better audit data enabling benchmarking and continuous improvements. The Board became convinced that the health and safety management system is an efficient and cost effective way to reduce losses.

The figures quoted above are not anecdotal. You can view the case studies on these two organisations, and over 20 others, in more detail on the UK Health and Safety Executive website at: www.hse.gov.uk/business/casestudy.htm.

What is the role for the Chief Executive in this? The fact is that they set the tone for the organisation. If they show an interest, so will the rest of the organisation. But this has to be an interest observable by others and reflected in behaviour.

A big oil company noticed an increase in safety incidents in their offshore rigs. They did a 360 degree survey on whether employees thought management put safety first. What really disturbed them was not just that employees did not, but that board members did not think their own colleagues on the board put safety first. They sat down and thought through how to make sure what they did really reflected their priorities. So now, whenever a senior manager goes offshore, their first question to staff is about safety. It used to be: "How's production?". They have taken a number of similar steps to ensure staff know that interest is real, and incidents are now declining in numbers.

You can make a difference by understanding the performance of your own organisation. Do you keep statistics of health and safety incidents and sickness absence, do you analyse them, do you do anything as a result? Does your board know how you compare with your competitors? Is your health and safety policy really implemented? Could you reduce recruitment and training if you kept more of your skilled employees at work? How often does your board discuss these issues and is it only at the end of the meeting when people are tired or want to leave? HSE has produced a means of ranking your organisation's performance with a streamlined version for small companies and a more complete one for larger organisations which goes well beyond simple accident statistics. Insurance companies have shown interest in this too, as have a number of investment managers. This can be found again on the HSC website.

It is likely, unless you are an unusual company facing special hazards, that two thirds of your days lost for occupational reasons are due to musculoskeletal disorders and stress. Both can be prevented and their effects can also be mitigated as demonstrated by the polythene company. There are also examples of hospital trusts who have reduced the number of days off their nurses take for bad backs by 90 per cent. We have published management standards for stress, again on our website, and are working with 100 organisations to help them improve their performance. Both these issues, often thought intractable or beyond normal management interaction, can be tackled successfully allowing reductions in sickness absence and more productive and better motivated staff.

Good health and safety regulation is also an important part of enabling the operation of some activities which might otherwise cause too much public concern. The nuclear industry is an obvious example. Its continued operation requires a safety regulator who has the confidence of both the public and the industry. Similarly for work with genetically modified organisms. The regime developed by HSE has allowed this to take place without over-burdensome restrictions, to the relative advantage of the UK.

HSE worked with government and industry during the fire brigade strike to ensure that industry did not need to close down - as some had feared, but rather took proportionate action such as reducing inventories of flammable material or ensuring that work that might create a fire hazard was scheduled for strike free days.

We are also looking to the future to facilitate new industries. HSE is working on the standards and procedures needed to develop the hydrogen economy, for example those concerned with storage and transport. Managing perceptions is important and there has already been one case where planning permission has been refused, citing safety concerns that at lease in our view, are not well founded. We are also working with the Royal Society and others to establish the appropriate health and safety regimes for nanotechnology to help allay the more extreme fears about nanogoo.

Finally, and a more light hearted example, HSE worked with Granada to develop methods for allowing leopards to be used on a Coronation Street set without risk to actors or film crew - or indeed to the animals!

The UK has one of the best occupational health and safety records in the world. I firmly believe that this is not a cost. It is a benefit and source of real comparative advantage, allowing organisations to retain the services of skilled experienced staff and so to have a longer and more profitable working life. My challenge to chief executives is to get you to think through how better health and safety can benefit your organisation and your staff or can enable a new process.

Biography

Timothy Walker became Director General of the Health and Safety Executive in October 2000. Previously an academic scientist, Mr Walker has taught physics and chemistry at various universities. He has also worked on trade with the Middle East, telecommunications liberalisation and grants to industry at the Department of Trade and Industry and been principal private secretary to successive Secretaries of State for Trade and Industry.

Other posts held have been UK Governor of IAEA, Chairman of the EBRD Nuclear Safety Account, Home Office DG for immigration and nationality; and Deputy Chairman of HM Customs and Excise. He is also a non-executive director in the public and private sectors and a lay member of the Council of Warwick University.

Mr Walker retired from his position as Director General of the HSE in November 2005.

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