We are often unaware of the environments that we live and work in. Too often do we safety for granted and unappreciative of what supports us, where for many countries, safety is not a priority. But if we were to cast a detailed eye on our working environments, where we live and socialise, where we holiday...what it takes to create these safe environments and indeed the related cost of implementing the appropriate level of safety precautions, the attached value would be exponential and challenging to qualify.
The Foundation is keen to understand how the financial cost of safety is calculated against the positive value derived. For example, what is the risk of not having appropriate safety practices, what is the subsequent cost and how is it measured. Indeed is there an unmet need around the process of calculating the value of safety; and what are the opportunities and potential for positive impact from an improved understanding and application of assessing the value of safety. These questions are more pertinent today particularly in light of Covid-19, where business decisions are heightened with safety very much in mind, the value piece attached becomes even more prevalent.
With a focus on both occupational health and safety and safety of property, the breadth of costs associated with such interventions can range from the cost to the employer (including business interruption, loss of trade, reputational, insurance, compensation, costs of restorative action and preventative measures, impacts on value, etc.); personal cost (health and wellbeing, loss of earnings, benefit claims); social cost (impact on family, emotional, etc.); those hidden costs (to both insured and uninsured organisations) and the opportunity cost (as lost foreign direct investment (FDI) in countries that do not make sufficient government investment in safety regulation); and more.
We want to understand how the value of safety is currently defined and measured, and what methodologies currently exist to value it. From a practical perspective, we’re interested in whether existing methodologies are being used, who is applying them, and how they influence decision making. The findings from this scoping work will support our understanding of the context of the value of safety, and help identify whether and how further work in this area will drive impact. We are currently in the process of commissioning the work with a view to publishing and informing future workstreams in summer 2021.
It’ll be interesting to see what the work comes back with and how it will challenge current and future thinking on understanding the value we attach to safety. A big one for the team is to see what information gaps exist if any and what measures can be implemented. Indeed how can the insight we glean help inform and improve decision making processes, so that the true value of safety can be understood, and the subsequent balance of interventions be implemented. Watch this space...
Disclaimer: all blogs featured are the views of the author and not representative of Lloyd's Register Foundation.