The Board has a responsibility to ensure that a compliance program is in place and operating effectively (Australian Institute of Company Directors Course, 2011).
A compliance program is an essential component of the company. The program includes:
- Policies and procedures, which ensure it meets the requirements of regulatory frameworks in which the company operates.
- A positive environmental culture, an important component of any compliance program, which is often overlooked.
7 questions for directors to explore in relation to environmental compliance include:
- Does the company have a register of all applicable legal obligations?
- Is there training and awareness, including refresher courses of all applicable legislation? Explore this further by requesting topic, audience (who attended, representation from all levels, departments, voluntary or not), competency testing, qualifications of the educator?
- How often are changes to legislation being reviewed? communicated? assessed for implications to the company?
- Is there a change control procedure in place to assess compliance requirements for changes to equipment (e.g, diesel storage), activities, processes, disturbance footprint? (if change occurs and has not been assessed for legal implications by appropriate personnel then this is the most likely time that a company will become non-compliant)
- Historically, when were the change control procedures implemented? If some time has passed following company establishment, has an assessment/external audit been conducted to determine if non-compliances have occurred as a result of changes prior to the implementation of the change control procedure?
- How often are internal and external audits conducted to determine: if there are non-compliances? if the change control procedure is being implemented effectively? if the above questions have been answered correctly?
- Is there an ISO 14001 certified Environmental Management System in place? (there are simply no excuses for not having this system in place, it can be implemented cheaply, it can be implemented fit-for-purpose, it can be implemented when other systems in the business are lacking!).
One question that I havent included is: Is there a positive culture of environmental responsibility? It is often difficult for directors to assess this and would need to gauge culture through informal discussions and observations of leadership teams at all levels, including management’s reactions to environmental topics in various meetings. Most mining companies don’t have a positive culture at all levels of the organisation. Therefore, regardless of how well the questions above are answered, there will likely be a risk of occurrence of environmental non-compliances unless a culture-building program (see Blogs in the category Environmental Culture) is implemented.
The comprehensive assessment and monitoring of the implementation of compliance programs may be the responsibility of the Audit and Risk Sub-committee of the Board.
In addition, the questions above should also be applied to land tenure, OHS, corporate governance, intellectual property, industrial relations and human resources, information systems, taxation and finance.