Encouraging Client and Supplier Companies to Adopt Similar Risk

The components of risk management discussed thus far deal mainly with the management of risk at one’s own facility or plant. However, a comprehensive program also addresses systems that can be put into place to encourage customers, supplier companies and hazardous waste disposal companies to practice similar levels of risk management. Included among the target organizations for this effort are the transportation companies that carry feed materials from suppliers, product materials to customers and contract manufacturers, and hazardous wastes to disposal firms. The overall purpose of the component is to create a level of risk management that is suitable and consistent among all industry players. The underlying philosophy for all companies to understand is that serious incidents affect the viability of the entire companies to understand is that serious incidents affect the viability of the entire industry. Not just their own company. It is important, therefore, to encourage and persuade others to adopt similar high standards of risk management.
These programs require commitment from management and an organized coordinated effort among many functions in a firm. Because these programs can directly affect intercompany relationships, they cannot be undertaken without strong senior management support.
Various strategies can be used to encourage good risk management in other firms. Strict contractual arrangements, memoranda of understanding, inspections and cooperative agreements can all be satisfactory, depending upon one company’s knowledge of the other company’s operations. When implementing a program of this kind, marketing and sales personnel and buyers should be aware of such strategies so that communication with customers and suppliers can occur early in the process. Business managers should also be involved in the process to demonstrate the overall commitment to this philosophy.
Reference: CCPS(1989) Guidelines for Technical Management of Chemical Process Safety

Management/Risk Management