Your Diligence is Due

Due diligence is a term that gets thrown around quite loosely, don’t you think?  It can be applied to many situations, for example, when investing in shares or a business, it is likely someone will ask you “have you done your due diligence?”. But, what does it actually mean?

If we take the definition from the dictionary, due diligence means the care that a reasonable person exercises to avoid harm to other persons or their property. In very simple terms, we can say that due diligence is a process that involves:

  • doing research on a topic;
  • thinking things through;
  • making decisions based on the outcomes of your research;
  • planning ahead

Its playful antonym is fake it to you make it or winging it!

Now if we take due diligence and put it in the context of work health and safety, the same meaning applies, however in work health and safety legislation, there is a bit more oomph in its definition:

At a minimum, an officer must take reasonable steps to:

  1. acquire and keep up-to-date knowledge of work health and safety matters
  2. gain an understanding of the nature of the operations of the person conducting a business or undertaking (PCBU) and generally of the hazards and risks associated with those operations
  3. ensure that the PCBU has available for use, and uses, appropriate resources and processes to eliminate or minimise risks to health and safety from work carried out as part of the business or undertaking
  4. ensure that the PCBU has appropriate resources for receiving and considering information regarding incidents, hazards and risks and responding in a timely way to that information
  5. ensure that the PCBU has in place and implements processes for complying with any duty or obligation of the PCBU under the Work Health and Safety Act, and
  6. verify the provision and use of the resources and processes referred to in paragraphs 3 to 5 above.

(Model Work Health and Safety Act, 2011)

Essentially, as an officer (an individual duty holder), you must take reasonable steps to ensure that the business uses and applies appropriate resources, policies, procedures and health and safety practices.  The due diligence obligation recognises that the behaviour and decisions of officers of a PCBU:

  1. determine whether the PCBU complies with its work health and safety duties, and
  2. strongly influence the health and safety culture of businesses and undertakings

In simple terms, as an officer if you have a high regard for health and safety, your safety culture is going to be awesome. On the other hand, if you have no regard for health and safety, the safety culture in your workplace is likely to be somewhere in the pits.  Professor Patrick Hudson’s evolutionary model of safety culture (Hudson, 2001) offers an insightful safety culture roadmap.

Where are you on the model?

The evolutionary model of Safety Culture

Figure: The evolutionary model of Safety Culture (Hudson, 2001)

As an individual duty holder, the key to meeting due diligence obligations is:

  1. well-informed – know your organisational risks and compliance requirements;
  2. prudent – use your research and knowledge to carefully plan for health and safety outcomes.

Failing Due Diligence

There’s no beating around the bush here – if you are an officer and you don’t perform your due diligence, you don’t have a leg to stand on.  You can be held personally liable and prosecuted for a failure to comply with your due diligence obligations.

There’s no shortage of case law showing the consequences of the failure to perform due diligence.  In the very recent case of SafeWork (NSW) v John Allen Romanous [2016], John Romanous, the sole director and shareholder of Romanous Contractors, was convicted and fined $85,500 for failing to meet his due diligence obligations and thereby exposing a worker to a risk of death and serious injury.  The prosecution was a result of an incident that occurred at a construction site where Romanous Contractors were the principal contractor and John Romanous the Site Manager at the premises.  A sub-contracted worker sustained fatal head injuries and died at the scene after falling through an unsecured penetration.  Romanous Contractors as the PCBU with a primary duty of care was also convicted and fined $425,000.

An Important Take Home

As an officer, your behaviour combined with your decisions strongly influences the health and safety culture of the business.  You are accountable for the health and safety success of your business.  You must demonstrate determinationperseverance, dedication and stick-to-it-ive-ness.

In the words of Professor Patrick Hudson “if you make it to the top of the culture ladder, everyone benefits – commercially, environmentally, socially and you all get to go home in one piece – every time.”


— Amy Towers, Principal Consultant, Risk Collective

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