This studied OHS performance measures (OHSPM) published by Australia’s 50 largest ASX listed firms between 1997 – 09.
37 of 50 sampled firms provided injury data in their annual disclosure at least once over the reporting periods.
Overall, authors note a general reluctance of firms to disclose OHSPM related to higher consequence events and other pertinent information – making it difficult for investors to gauge the effectiveness of risk measures.
Despite an increase in the quantity of OHS data being reported, it was observed to be increasingly narrowed in focus to minute details of lower consequence events in order to “attenuate stakeholder perceptions of risk” (p125).
Indeed, relating to the data from high-risk industry firms “much of this … data was found to be incomplete, unstable and poorly defined … and therefore … unreliable” (p124).
Interestingly, 5 companies reported 0 fatalities in 23% of reports but made no mention in the other 77% – suggesting the omission of bad information. Some firms had even failed to disclose work fatalities, despite mentioning them in other media. Few identified OHS regulatory investigations, prosecutions or fines.
Expectedly, firms in higher-risk industries were more likely to disclose injury performance data compared to medium and lower risks; although industry was more strongly correlated than risk profile. This is with the exception of the Utilities sector, where Government ownership was more strongly correlated to reporting.
Higher-risk industries provided more injury reporting KPIs. However, firms focused more on injury occurrence, and especially LTI/LTIFR or MTI, rather than elaborate on data for severity of non-fatal injuries (only 7 of 281 reports gave info on the severity of non-fatal injury); severity was related back to Geoff McDonald’s excellent injury taxonomy.
Further, few companies provided data on occupational health exposure or psychosocial hazards.
Where more injury data was provided, this tended to focus around aggregated lower-consequence subsets of injury (e.g. FAI, MTI) rather than provide data on higher consequence.
Of the data presented, the authors also say that “of OHS accounting appear to construct a reality in which occupational illness and injury severity are largely ignored and all non-fatal lost time injuries are equal” (p125), which directs investor attention towards traditional injury metrics of lower consequence.
Authors: O’Neill, S., Flanagan, J., & Clarke, K. (2016). Safety science, 83, 114-130.
Link: https://doi.org/10.1016/j.ssci.2015.11.007
Link to the LinkedIn article: https://www.linkedin.com/feed/update/urn:li:ugcPost:6939333066972618752?updateEntityUrn=urn%3Ali%3Afs_updateV2%3A%28urn%3Ali%3AugcPost%3A6939333066972618752%2CFEED_DETAIL%2CEMPTY%2CDEFAULT%2Cfalse%29
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