Recent legal cases and industry discussions highlight a growing concern: many executives and board members are not receiving the right health and safety information to fulfil their due diligence obligations.
Recent legal cases and industry discussions highlight a growing concern: many executives and board members are not receiving the right health and safety information to fulfil their due diligence obligations.
Australian health and safety lawyer Greg Smith, speaking on the Tony Gibson sentencing decision, emphasised that standard H&S reports often fail to provide executives with meaningful insights. Instead of offering assurance that safety systems are working effectively, many reports rely on high-level statistics and generic data.
Executives must take a more critical approach by asking:
Smith’s point is clear: Boards cannot rely solely on others to filter and interpret safety information for them. They must personally engage with the right questions to acquire relevant insights.
The Gibson decision reinforces the lessons from Piper Alpha, Pike River, and similar cases: executives must ensure proper assurance mechanisms are in place. However, this does not mean that directors need to conduct site inspections themselves. Instead, their role is to ensure that:
A troubling interpretation from the Gibson case is that it appears to suggest executives require some degree of operational involvement to meet their due diligence obligations. As lawyer Grant Nicholson pointed out in a recent NZISM webinar, this could blur the line between governance and management. Executives should be informed, not operationally embedded.
A major concern raised by Smith is the risk of safety initiative overload, which is the tendency for organisations to introduce more safety initiatives in response to legal cases and regulatory pressure. While well-intentioned, this can lead to:
Executives and directors must evolve their approach to safety governance, not through knee-jerk reactions or overwhelming teams with initiatives, but by ensuring they receive the right information, ask the right questions, and demand real evidence of effectiveness.
Is your organisation’s safety reporting truly giving executives what they need to know? See how Practicable can help.
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