Crisis resilience and human capital
“People are at the core of every thriving business,” says Kathy Seabrook. It’s a truth she believes the Covid-19 crisis has brought home, both showing the critical importance of those filling some under-considered jobs, from healthcare workers to logistics staff, and highlighting the flexibility and creative capacity of many workforces.
She points to the example of the Ford Motor Company’s US operations where production lines were adapted from producing cars to making hospital respirators in the first wave of the Covid pandemic. “It took very smart people to switch those lines in such a short time.”
I asked Kathy, who is former president of the American Society of Safety Professionals to expand a little on her chapter in the One Percent Safer book, because it combines two topical issues: the Covid pandemic and the growing interest in human capital management.
Human capital, of which sound safety and health management is an integral part, has been driven up the agenda by the interest of institutional investors, who are naturally keen to put their money where it will grow. Many of them see businesses who do not look after their workforces as threatening that growth as taking unnecessary risks which could come back to bite them in a gradual drain of talent, if not in regulatory sanctions for poor safety standards.
Major employers are aware of this investor interest and are changing the information they share on their performance. Kathy points to a report in August 2020 by US finance data company MSCI, which showed that the proportion of companies publicly disclosing their safety and health audit measures jumped from 59% in 2015 to 89% in 2019.
“That was encouraging because health and safety has not been to the fore,” she says.
Increasingly, says Kathy, “Investors are asking ‘Where are your risks? What are your opportunities?’” And in a knowledge- and services-driven economy, employees and how they are nurtured and cared for represent the greatest opportunities and the biggest risks to sustained profitability.
“We need to change the math for companies, from people equals cost, to people equals value,” says Kathy, who is an ambassador for the Capitals Coalition, which promotes the benefits of putting human and environmental issues at the centre of business.
Safety and health professionals have an important role in helping organisations show their human capital bona fides but don’t always realise the external pressure is growing.
“It’s about our profession understanding the business environment we operate in,” Kathy told me.”If we put our heads and hands around this, it is our future. It will create value for us too.”
In her original contribution to the book, Kathy challenged OSH leaders to ask the important questions: “Does your company know its potential high-consequence risks? Would your company be resilient in the event of a low-probability, high-consequence incident such as Covid-19?”
Her questions chime with Siemens global safety head Ralf Franke’s point in his contribution to One Percent Safer, that organisations need to work fast to codify the information in their organisations about what they did well and badly in responding to the pandemic, to help ensure they are resilient when the next low-probability shock comes. And a lot of that resilience, as Kathy emphasises, will depend on how they value and manage their human capital.
Kathy’s contribution is just one of 137 thought-provoking chapters in the One Percent Safer book. Order your copy here.