What Are Key Performance Indicators?

A key performance indicator is a metric that is tied to a predetermined target and represents how
far it exceeds or falls below that target. KPIs provide the company with objective data about their
health and safety situation, ensuring adequate feedback on the effectiveness of safety initiatives
and policies.

What Are the Characteristics of a Good KPI?

A good KPI should be:

 Specific – It must be clear what exactly the KPI measures

 Measurable – The KPI has to be measured according to a defined standard so that the
actual value can be compared to normal standard values

 Achievable – Every KPI has to target a realistic and feasible goal (nothing is more
discouraging than striving for an outcome that will never be obtained)

 Relevant – The KPI must give insight into the organization’s safety performance

 Time phased – A KPI only has a meaning if we know the time dimension in which it
realized

Key Performance Indicators for EHS

The field of EHS deals with a large number of risks that need to be effectively and efficiently
managed. If they are going to be a useful tool for EHS management, key performance indicators
should provide quantitative (or semi-quantitative) data that reflects the safety and health issues
and activities in the organization such as information on existing and emerging risks, exposures,
and hazards. The data should also inform safety leaders about the success or failures of
preventative actions aimed at mitigating and controlling workplace hazards.
The two main types of key performance indicators use most frequently are lagging and leading
indicators.

1. Lagging Indicators

Lagging indicators measure a company’s incidents in the form of past accident statistics. The

most important EHS lagging indicators are:

 Work-related injuries that qualify as lost time injuries (LTIs) (see how can businesses-

reach a goal of zero incidents/ to learn more)
 Lost production days due to sick leave
 Incidents or near misses (find out The-connection between near-misses and incidents )
 Complaints about work that is carried out in unsafe or unhealthy conditions (learn How to
Refuse Unsafe Work)
 Early retirements
While those common lagging indicators focus on what went wrong with the company’s safety
performance, many safety professionals and company leaders prefer to obtain positive feedback
and instead opt to focus on what went well. Example of positive lagging indicators include:

 Percentage of productive planned work days realized

 Number of hours worked (by the total work force) without LTIs
 Number of working days since the last accident
 Employee satisfaction

2. Leading Indicators

Leading indicators are measures of conditions and activities geared to the prevention of

accidents. Leading indicators, therefore, have predictive value and can be used to improve safety
management systems. And, moreover, they tend to measure the factors that are considered key
elements of well-performing management systems.

Important EHS leading indicators include:

 Percentage of managers with adequate EHS training

 Percentage of workers with adequate EHS training
 Number of workplace inspections
 Frequency of (observed) (un)safe behavior
 Number of EHS audits performed
 Percentage of EHS suggestions or complaints for which feedback was provided in a
timely manner (for advice on handling feedback,
 Prevalence of certain health problems (e.g. as outcomes of health surveillance)

Selecting the Best Key Performance Indicator(s) for Your Organization

Before selecting KPIs to be evaluated, safety professionals and company leaders must first
understand the safety risks of their operations, evaluate the systems that are in place to manage
these risks, and grasp the organization’s business goals, strategies, and culture.

According to Jan Baldauf, a senior project manager at Environment Resources Management in

Ewing, New Jersey, the KPIs that are best suited for a particular organization depends on several
factors, such as:

 Where is the organization today with respect to health and safety performance?
 Where does the organization want to be tomorrow?
 Who receives the KPI data and what do they do with it?
 How are KPIs and the conclusions that are drawn from the KPIs communicated to
others?

Limitations of Key Performance Indicators

While key performance indicators can provide organizations with objective and valuable
information, it may be beneficial to keep in mind a few factors that limit the usefulness of KPIs:

 Underreporting, which is especially frequent where there is a lack of a positive EHS

culture
 Positive events are usually not measured and recorded
  An outcome measure (e.g. an incident) does not reflect the causes of that event
 A focus on KPIs may lead managers to neglect important issues that are not measured

 The Bottom Line

By providing valuable feedback and helping to motivate company leaders, KPIs are important for
keeping an organization’s EHS management system in ship shape. Combining lagging and
leading indicators is an especially good way of getting an adequate picture of workplace safety,
both its current state (lagging indicators) and the measures in place to improve it (leading
indicators).

As the saying goes, “What gets measured gets managed.” Keeping tabs on KPIs ensures a
proactive approach to workplace health and safety.