The recent directive for federal agencies to review safety rules at chemical facilities nationwide can be seen as a welcome development in the interest of furthering safety. After all, the action follows recent explosions, including one that leveled a fertilizer plant in West, Texas.
To be sure, redoubling efforts to ensure safety in communities where potentially dangerous chemicals are being used should be applauded and supported by manufacturers. Nevertheless, such efforts do not come without unintended side effects.
Let’s start with this: safety is everyone’s responsibility, from community leaders to company CEOs and government regulators. But what does a “federal review” really look like in action? What are the additional actions that companies may now have to take, and what additional scrutiny may they now face, even if there is nothing wrong with their current safety processes?
The fact is, companies may now face additional government oversight that may improve safety, but certainly will increase cost to the company in terms of lost productivity, increased penalties for non-compliance and more. Regulators will likely increase enforcement and scrutiny of those companies they oversee to show their bosses and the public that they are “doing their jobs.”
In this time of increased oversight, companies can expect:
- More visits to their facilities from regulators, requiring additional company manpower dedicated to answering their questions and making required changes to operations
- Additional fines, possibly for violations that are not in compliance with the letter of the law but do not in fact present actual safety concerns
- Negative publicity as regulators issue news releases to announce investigations, violations and fines to publicly demonstrate that regulators are carrying out the president’s directive
- Higher costs to companies for storage and use of potentially hazardous chemicals as upgrades in equipment or facility structure are demanded by regulators
- Certainly, furthering the cause of safety is a noble concern that should not be trivialized. Safety is, indeed, everyone’s responsibility and everyone’s business. But now that government has demanded action, companies should be extra vigilant about the potential impact on their day-to-day manufacturing operations, even if they’ve never had a violation, a fine or an accident at their facilities.