28/5/2010

Auditing Responsible Care

by
S.K.Hazra
Chairman-SHE Expert Committee,ICC
and
RCLG-Country representative India,ICCA
I

Responsible Care concept started as a voluntary self improvement program for

Chemical Industries to improve its Safety, Health and Environment footprints.
Responsible Care aims to create safer, healthier and environmental friendly
world for the present and future generations. It started in 1985 under the
auspices of “Canadian Chemical Producers Association (CCPA)” with Six Codes
of practice, eg., Process Safety Management, Pollution Prevention, Employee
Safety and Health, Community Awareness, Distribution and Product
Stewardship. Soon thereafter it was adopted by other National Chemical
Associations starting with American Chemistry Council (ACC) and then CEFIC.
Today there are 51 National Chemical Associations who are committed to
Responsible Care.

Subsequently, post 9/11, security of major chemical sites ( being inherently

hazardous in nature) became a cause of major concern and American Chemistry
Council (ACC) proactively adopted the Security Code.

However, it was soon felt that while Chemical industries believed that they are
doing the right thing by religiously following the Responsible Care concept,
embodying its Codes and Management practices, the stakeholders, specially the
authorities, public and NGOs did not understand Responsible Care and hardly
appreciated it.

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Chemical Industry captains realized that they have to cover a large ground to
create public credibility to the industries’ genuine efforts to change “Bad Boy
dogma” through voluntary Responsible Care movement. Though Responsible
Care calls for voluntary efforts on the part of the signatory companies, to create
“credibility “ with “outside stakeholders” a Third party certification of Company’s
Responsible Care progress through audit will immensely help.

Audit in an Industry sector means a process of examining the Industry’s sector

specific practice and comparing against the set of standards.

The Audit Process are to identify areas that require improvement at three levels
viz:
a) At first level, audit focuses on resources and compliances
b) At second level, it looks at activities of the companies whether they meet
pre-defined standards.
c) At third level, all the leading indicators are to be audited one for example
being “near misses’ ie how many near misses have been reported say in
last five tears and their trend during this period.

The audit should benchmark the performance of standards of the companies in:

- Identification and Assessment of Hazard

- Check effectiveness

- Hazard prevention

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 - Reduction and control measures at following levels:
a) Inherent
b) Active
c) Passive
d) Procedural

- Pollution control measures whether in place and its performance

- Prevention of unsafe act or condition by the employees

- Status of employee safety awareness

- Measures to protect employee health

.
- Interaction with community and public around the Company’s site.

- Extent of openness in hazard communication

- To assess the supply chain management by the Co. of its raw

materials, products, catalysts etc. the way the Co, assumes
responsibility (as it does in its manufacturing activities within the
site).

- Assess Company’s understanding of its responsibility in “cradle to

cradle management of its chemicals/products”

- Company’s safety culture

- Top management commitment

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At the apex level, the “Responsible Care Leadership Group (RCLG)” under
“International Council of Chemical Associations (ICCA)” sets the Responsible
Care practice guidelines for all the 51 National Chemical Associations.
RCLG has cleared the use of “RC Logo” by the individual National Chemical
Associations and left it to the Associations to decide on allowing use of “RC
Logo” by its member-companies who are signatories of Responsible Care.
Use of “RC Logo” is entirely left to National Chemical Associations to mandate its
use among its member- companies.

Responsible Care is a purely voluntary movement and it is left to individual

companies to decide whether to adopt “Responsible Care principles” and
practice the Responsible Care codes and management practices (under the
umbrella of Countries’ National Chemical Associations). Further on reaching
high level of performance in the RC Code of practices, determined through self
assessment, the Companies may subject themselves to the third party audit.

National Chemical Associations follow different guidelines, country to country in

allowing use of RC Logo by its signatory members such as

a) Self Audit and Declaration by the Companies (EU and SE Asian Model)

b) Company volunteering RC audit, which is conducted by the National

Chemical Associations’ Responsible Care Audit Team and Audit Team
certifying the Company at high level of RC performance (Indian Model).

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c) Compulsory RC Audit for its members by certified Third Party RC Audit team
with members from community and industry coordinated by the National
Chemical Association (Canadian Model).

d) Compulsory Third party RC Audit by National Association accredited Auditors

for all association members (US Model)

In the earlier stage, when the idea of auditing was mooted at ACC, there was
fear among certain quarter of their members on the possibility of “Legal Liability”
arising out of third party audit. Initially entire issue of verification through third
party was a “thorny one” and was not clear to many members, how valuable
would such a verification program (Audit) be . There were skepticism

ACC in US evolved RC-14001 certification system encompassing “Health,

Safety and Product Stewardship” over and above ISO-14001 – Environmental
Management Assessment. For creating RC-14001, ACC collaborated with US’s
Registration Accreditation Board. Companies under ACC, are also free to
choose “Responsible Care Management system (RCMS) audit” with
independent auditor approved by ACC.

CCPS on the other hand follow a different audit model. CCPS had required
mandatory verification (Audit) of RC for al its members since 1993. This audit
team consist of four experts, two each from public and Industry. Out of two
Public verifiers, one is from CCPA’s National Advisory Channel and the other
from the local community around the site. Of the two Industry members, one
is a retired Chemical Industry executive and other a retired RC Coordinator.

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ACC’s verification audit is a pass/fail exercise, which is not the case with with
CCPA’s Audit approach.

CCPA aims to help through audit its members to get better in RC ethics. CCPA
audit team in a no. of occasions continue with repeat audit visits (as much as
three or four nos. at times) when a Company is found weak in RC practices.
CCPA provides prompt help to such co. to reach the desired level it its RC
performance..

ICC is committed itself to promote RC (1994) and it left it voluntary for its
members to commit themselves to RC. As on today, about 1/3 rd of ICC members
(i.e. 100nos out of 300 odd members) have signed RC commitment pledge. In
order to promote verification audit, ICC allows use of coveted “RC Logo” only to
its signatory companies who volunteer themselves to rigorous RC audit once in a
period of 3 years by ICC RC Audit Team and audit team finding the Co.
practicing RC diligently.

As on date, only 10 of the 100 signatory companies have qualified for “RC Logo”,
which speaks of quality of RC audit carried out by ICC.

ICC is now planning a specific RC Pollution audit for its members who volunteer
for audit of their sites, specially the ones, falling in recently designated “Critically
Polluted Areas” by Central Pollution Control Board (CPCB). Govt. of India .ICC is
planning to broad base this team to include noted academic experts and retired
senior level Govt. expert scientists who had been with CPCB..

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CPCB has notified a list of highly polluted “Chemical Clusters” as “Critically
Polluted Area” and put a blanket ban on setting
up of new industry /expansion of existing ones. However there are a no of large
/well managed ICC member co. sites in these clusters who religiously conform to
even better prescribed limits of Pollution and manage hazardous ware as per
applicable rule. These Cos practice Responsible Care diligently but face the
same restriction because of few non conforming Industries operating in the same
cluster. ICC through this audit wants to separate “apples” from “rotten oranges”
to attract the attention of the “Regulatory Authority.

In contrast to North America, in EU, on the other hand RC is established as a

“Management Systems Approach”. Though at present RC practicing Cos.
mostly regulate themselves through self assessment only (barring countries
such as Germany, UK, etc) a provision for external verification at a later date is
being seriously considered. CEFIC is gradually adopting voluntary audit under
the umbrella of respective Chemical Association. UK is one of CEFIC member,
pioneering third party audit.

In Germany too, third party audit of RC was mooted among VCI members.
Recently COGNIS, Germany successfully qualified after RC audit by BCI.
Following this, ICCA has awarded COGNIS certification in recognition of the
same.

“RC Global Charter” approach was initiated by ICCA in UN sponsored SAICM

Conference at Dubai in 2007 stress the need to strengthen “Certification
Process”. In general it is established that “Third party verification of Company’s
RC performance” strengthens Chemical Industry initiative of “Global Product
Strategy (GPS)” a commitment by ICCA.

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In addition to the initiative taken by National Chemical Associations under
International Council of Chemical Association (ICCA), the global trader body ie.
International Council of Chemical Traders Association (ICCTA) who deal with
chemical logistics had committed to convince members to undertake “third party
audit verification”. Almost 58% of their members have committed them to third
party RC audit.

Govt. Bodies in US were first to recognize the RC practicing companies, who

benefited than being subjected to a major regulatory environment.

The benefits likely to arise for RC practicing Cos.from third party RC audit are:

- Financial marketing recognition.

- Compliance assurance
- Return on Investment
- Gaining efficiencies
- Risk and liability reduction
- Improved community relation
- Competitive advantage
- Customer expectation
.

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