Understanding Due Diligence in Risk and Safety

by Dr Rob Long on March 2, 2017

in Due Diligence

Understanding Due Diligence in Risk and Safety

due diligenceIn order to understand Due Diligence it is sometimes helpful to understand its opposite, negligence. How does one demonstrate ‘Due Diligence’? How does one ‘exercise’ Due Diligence? What are these 6 steps outlined in the Act (WHS Act Part 2, Division 2.4, Section 27)? What is the ‘duty’ and ‘obligation’? Who needs to ‘exercise’ Due Diligence? What is the context for all this? These are all questions that face a person (officer) undertaking a business or undertaking.

Before answering these questions it is important to dispel some of the myths that get thrown about the safety sector, nothing like making money out of fear. The most important thing to note is that Due Diligence is entirely subjective (like ALARP), there is no mathematical formula for exercising Due Diligence. The WHS Act states that Due Diligence ‘includes taking reasonable steps’. It is amazing the spin that it out there that speaks of Due Diligence as some kind of systemic behavior. It is also crazy to hear people speak about Due Diligence as if it is something directed to safety people or workers. At best the WHS Act provides a ‘guide’ to the kinds of things a business must do to exercise Due Diligence. The beauty of this subjective challenge in the WHS Act is that it exorcises the tendency for businesses to be minimalist (in the duty of care).

But let’s shift the focus from business to another metaphor, families. How would one know if one was a negligent parent? What evidence would one need to demonstrate this? In the work of Child Protection it is extraordinarily difficult to demonstrate negligence and a lack of Due Diligence. At what point would you be prepared to take away a child from their family? Is hitting a child enough? Leaving them in a car whilst the parents play the pokies? Not cleaning, feeding or clothing their children? At what point would you be prepared to declare ‘neglect’? We all have subjective benchmarks based upon experience that give us some judgment about negligence? When Child Protection officers show up on the door to take your child away, you would want some pretty amazing evidence to do so. Interestingly, in the end, it is the court that decides if a child has been neglected. Whilst we might like to stand in judgment over what we might considered ‘neglectful’, the court knows that removing children from their family is an extreme measure and rarely ends the abuse.

When we bring the understanding of abuse, neglect and diligence to home, it helps clarify what might be meant by Due Diligence. The WHS Act ‘includes’ (which means it is obviously not exhaustive) ‘reasonable’ (highly subjective) steps. What is ‘reasonable’ to one is certainly not ‘reasonable’ to another. The other thing to note in the WHS Act is the recurrence of the work ‘appropriate’ (it is repeated three times). What is ‘appropriate’ for one is very different for another. Go back to the family metaphor and apply the word ‘appropriate’ to diligent parenting and see what I mean.

Once we understand that Due Diligence is an entirely subjective concept (that in the end is decided by the court), we then move away from nonsense proposals that limit Due Diligence to a formula or numerical activity. Due Diligence is principally a people-focused attitude. Due diligence is not a systems-focused activity. Systems are created to serve people not people to serve systems. If the system you have created doesn’t serve the needs of people, then you are not exercising Due Diligence. Human factors should never be about humans as a factor in a system. Systems-focused thinking doesn’t help people work within a system, people-focused thinking helps people make the best of a system. There is more too in the WHS Act that follows about the reciprocal responsibilities of the workers to Due Diligence but not much space here to discuss this in detail. What is interesting to note is that the word most repeated for worker responsibility is the word ‘reasonable’ (four times). So, in resonance of ALARP (https://safetyrisk.net/new-free-video-release-alarp/) we see again the subjective nature in approach to risk and safety by the WHS Act. How strange then that heads of organisations would then want to create a contradiction of the WHS Act by insisting of zero harm (and counting statistics) in their organisations. Zero ideology is directly opposed to the meaning of Due Diligence.

In order to help better understand Due Diligence I have released another video from the 22 video set of Risky Conversations, The Law, Social Psychology and Risk (http://www.humandymensions.com/product/risky-conversations-usb-drive/). The book adds to the videos by providing transcripts of discussion and evidence in the margins supporting the discussion.

The Due Diligence video can be viewed here:

4. DUE DILIGENCE from Human Dymensions on Vimeo.

Due Diligence Executive Program

Greg and Rob offer a 1 day Executive Due Diligence Program on the nature, understanding and exercise of Due Diligence. If you are interested in the program please contact Rob (rob@humandymensions.com ) for more information.

  • Tony Cartwright

    I love the line, ” Systems are created to serve people not people to serve systems.” I’m struggling to convince a current client that their system is not very people-focused. They have reams and reams of prescription – a nightmare to try & wade through & fails the ‘doability’ test every time.

    • Rob Long

      Thanks Tony, I spend most of my time helping organisation grab back the vision to humanise their organisations. It isn’t hard but the biggest problem is fear and will. Once an organisation dispenses of the needless fear and insane systems, it is amazing what happens to the culture. Then Due Diligence just becomes a way of organising and living, it becomes infused in how the whole organisation understands risk.

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