(The following edited item was submitted by Jayne Pilot, president of Pilot Performance Resources. She may be reached via www.PilotIMS.com or at 905-792-3130.)
We are all partners in managing our world's quality, environment, health and safety because it impacts hundreds of millions of people around the world. The mining industry in particular is criticized for its lack of sustainability. Many governments are implementing new legislation to increase regulation of areas related to climate change, energy conservation, and the health and safety of workers.
THE INTERNATIONAL FINANCE CORPORATION (IFC), the private-sector lending arm of the World Bank Group, looks to environment, social and governance (ESG) criteria when analyzing investment projects. The IFC came up with the Seven Questions to Sustainability, which included:
1. engagement;
2. people;
3. environment;
4. economy;
5. traditional and non-market activities;
6. institutional arrangements and governance; and
7. synthesis and continuous learning.
The ONTARIO SECURITIES COMMISSION announced its National Instrument (NI-51-102) in November 2007. These are the Continuous Disclosure Obligations that require reporting issuers to disclose information about their environmental impacts in their continuous disclosure documents. This information includes environmental risks and any other concerns that would likely influence an investor's decision to invest in these corporations.
SUSTAINABILITY SOLUTION: Standardization of management systems
In order to be in compliance with requirements for the environment and be a supporter of sustainability, managers need to run their businesses and resources to a criterion that is understood by others. That criterion is the "management system structure" developed by International Standards (ISO) and is accepted worldwide.
The ISO standards used by organizations around the world to implement efficient and effective management systems are 9001 (quality), 14001 (environmental), 18001 (occupational health and safety), and ISO 10006 (quality). Integrated management of these standards would assist in saving companies time and dollars.
Canada is not one of the top 10 countries in numbers of companies that have adopted ISO standards. The Canadian government provides funding for new technology, energy conservation and similar projects that may result in savings. However, it does not assist in improving the effectiveness of the way the mining industry "manages" risks associated with the company's operations. A management system does.
Environmental risks have a huge effect on the return on investments, but in addition can provide substantial tax credits under 'R&D' plus capital write-offs for clean energy-generating technologies, and environment grants and funds for clean-tech projects.
When a company is managed to ISO standards, it identifies risks (quality, environment, health and safety) and has systems in place to implement, monitor, measure and control the organization's operations. The focus is to continually improve a business through the system controls that are put in place. This new information is then available on an ongoing basis through the systems, to be formulated into reports on sustainability to investors and the public.
The ultimate benefit of implementing an ISO management system is that it provides a company with efficient management, ensuring identified risks are controlled. Internal audits and third party audits verify the effectiveness of the system. Compliance audits verify the legal requirements are being met. Non-conformances are tracked, reviewed and corrected. Controlling a company's risks, costs and savings has a positive effect on the bottom line.
To review frequently asked questions on management system implementation, refer to FAQ's on Pilot's website, www.PilotIMS.com.
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