IsoMetrix Takes On Enterprise Risk Management For Large Capital Projects And Firms

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1 IsoMetrix Takes On Enterprise Risk Management For Large Capital Projects And Firms S E P T E M B E R W W W. V E R D A N T I X. C O M

2 IsoMetrix Takes On Enterprise Risk Management For Large Capital Projects And Firms This report is one in a series covering prominent software vendors in the EHS software market. Headquartered in Johannesburg, South Africa, IsoMetrix is one of the few vendors with a unique heritage for meeting customer requirements that are less common in developed economies. After growing in its home market of South Africa, IsoMetrix has now successfully expanded its business into Australia, Europe and North America. IsoMetrix plans to significantly strengthen their footprint in the Americas region and will continue to target heavy asset and infrastructure sectors that have complex enterprise risk management needs. Verdantix analysis finds that firms seeking to strengthen cross-functional and site-specific visibility on enterprise risk management will benefit the most from IsoMetrix offerings. TA B L E O F C O N T E N T S IsoMetrix Takes On Enterprise Risk Management For Large Capital Projects And Firms... 3 IsoMetrix Draws On Several Strategic Strengths To Power International Growth A Risk-Centric Vision For EHSQ Management Underpins The IsoMetrix Growth Strategy Customers Seeking To Strengthen Cross-Functional And Site-Specific Visibility On Enterprise Risk Management Should Test The IsoMetrix Solution O R G A N I Z A T I O N S M E N T I O N E D 3E Company, Anadarko, AECOM, Anglo American, AngloGold Ashanti, Arcadis, CCPM, CDP, CH2M, The Committee of Sponsoring Organizations of the Treadway Commission (COSO), De Beers, EnviroServ Waste Management, Eskom, ExxonMobil, The Federation of European Risk Management Association (FERMA), Fluor, Foundamentality, Glencore, The Global Reporting Initiative (GRI), Huco Consulting, Integer, The International Integrated Reporting Council (IIRC), International Organization for Standardization (ISO), iot.nxt, Microsoft, Natref Refinery, OCEG, Qlik, Revolution Development Asia, Rio Tinto, Sasol, Scaw Metals Group, Sephaku Cement, Shell, South32, Sovereign Foods, Statoil, The Sustainability Accounting Standards Board (SASB), Total South Africa, Transnet, Two Rivers Platinum, Ulula 2

3 IsoMetrix Takes On Enterprise Risk Management For Large Capital Projects And Firms This report is one in a series covering prominent software vendors in the EHS software market. Headquartered in Johannesburg, South Africa, IsoMetrix is one of the few vendors with a significant customer base in Africa as well as in developed economies around the world. To learn more about its recent expansion into North America and the product s capabilities, Verdantix spoke with executives at IsoMetrix including co-founder Paul Marketos and John Castner, Managing Director North America. IsoMetrix Draws On Several Strategic Strengths To Power International Growth In a market dominated by vendors headquartered in Europe and North America, IsoMetrix has grown from its roots in South Africa, which provides the firm with a unique heritage in terms of meeting customer requirements that are less common in developed economies. Founded in 2004, the fundamentals of the business consist of: Offices in three continents staffed by 110 employees. IsoMetrix has approximately 110 employees currently, and growing, whom are distributed across their four office locations in Australia, Canada, South Africa and the United States. Since 2015, IsoMetrix has expanded rapidly into North America with employees present in Atlanta (Georgia, USA) and Toronto (Ontario, Canada). Functionality for a diverse range of EHSQ risk management scenarios. While IsoMetrix originally emerged as a compliance tool to meet the International Organization for Standardization (ISO) environmental management standards, its comprehensive suite of riskcentered solutions now provides functionality for the management of stakeholder engagement efforts and issues pertaining to environment, health, safety, hygiene, quality and social licence to operate. Go-to-market strategy expanding from extractives into other industries. Roughly four-fifths of IsoMetrix s existing customer base come from mining, metals, oil and other extractive industries. Existing customers include Anadarko, Anglo American, De Beers, Glencore, Scaw Metals Group, Shell, South32, Statoil and Two Rivers Platinum. IsoMetrix aims to establish itself as the goto solution for firms with heavy assets. More recently the vendor has branched out into other industries such as construction, food and retail, manufacturing and financial services. Establishing partnerships necessary to support product and business development. As part of its customer acquisition and product implementation strategy, IsoMetrix has established ten technology partners and ten channel partners organized by region to support market access. Example geography-specific partners include CCPM, a specialized social management consulting firm in Peru; Foundamentality, an organisational safety and behavioural change consulting firm in Mexico; Revolution Development Asia, an IT services provider in Mongolia, and Integer, a governance, risk and compliance (GRC) services provider in the United Kingdom. On the product development side, partners include IT software vendors (such as Microsoft and Qlik), nonprofit organizations (such as The Global Reporting Initiative (GRI)) and EHS solution providers (such as 3E Company and Huco Consulting). The partnership with iot.nxt, a South Africa-based internet-of-things solutions provider, for example, will strengthen the interoperability and interconnectivity of the IsoMetrix platform and has also led to opportunities to cohost thought leadership seminars. 3

4 A Risk-Centric Vision For EHSQ Management Underpins The IsoMetrix Growth Strategy After growing in its home market of South Africa, IsoMetrix has now successfully expanded its business into Australia, Europe and North America. The software provider has competed successfully against larger, entrenched competitors due to its: Product strategy that puts risk management at the centre of EHSQ systems. The IsoMetrix offering is a configurable management solution that captures all EHS and quality data points for risk analysis and decision-making purposes. IsoMetrix also provides customization services with plans to gradually build-out a comprehensive enterprise risk management platform. This platform will cover broad needs such as fulfilling requirements for: The Federation of European Risk Management Association (FERMA), The Committee of Sponsoring Organizations of the Treadway Commission (COSO) Enterprise Risk Management Framework, OCEG GRC certification and BS3110 British Code of Practice for Risk Management. Requests around quality processes, for example, have led IsoMetrix to introduce a quality risk-matrix that covers five loss-type categories: 1. Business process and systems, 2. Human resources and infrastructure, 3. Adverse publicity and reputation, 4. Statutory and regulatory, 5. Services and business interruption. Powerful functionality for stakeholder engagement to enable large extractive projects. The IsoMetrix social sustainability and social licence to operate modules ensure that firms with sensitive exposure to external stakeholders, such as local community residents and government regulators, can have the appropriate tools to track details such as contact information, interaction history, and make note of planned future engagement strategies. Stakeholders can also be classified by type and captured as individuals or entities, whilst users can also manage meetings (scheduling, attendance, issuing agendas and minutes) and grievances (receiving, assigning, investigating, resolving, following-up and closing-out) with the platform. From August 2017 onwards, IsoMetrix also partnered with Ulula, an omnichannel community engagement software provider, to enable mobile accessibility for project-related communications. ExxonMobil s environmental compliance team and land acquisition and resettlement team both use IsoMetrix to engage with different stakeholders. Alignment of the EHSQ platform with multiple ISO management systems. Firms such as AngloGold Ashanti, Rio Tinto, Sephaku Cement and Sovereign Foods have used the IsoMetrix platform to not only ensure compliance against OHSAS Occupational Health and Safety and ISO 9001 Quality Management but also to assess severity, assign corrective and preventative actions and manage performance across a spectrum of risk-based issues such as for food safety, process compliance, and occupational hygiene purposes. EnviroServ Waste Management, for example, adopted IsoMetrix to meet ISO quality standards (competence to carry out laboratory tests and/or calibrations) and deployed the Headline Risk module to produce a risk register for the group and understand company-level and site-specific risks across IT, communications, finance, security, human resources and other functions. Deployment model designed for complex operational sites, not just corporate hierarchies. The IsoMetrix out-of-the-box workflows for social sustainability, socio-economic analysis, EHS and grievance mechanisms are highly configurable and well-suited to large capital projects where a balance of both EHS performance and risk management is needed. Since the IsoMetrix software is offered onpremise or cloud-based, corporates and service providers looking to engage site-specific facility users can also selectively deploy modules to target issues such as health and safety or quality processes. This is 4

5 particularly helpful when managing social licence to operate since top concerns typically vary across sites depending on the local community concerns. For publicly listed electric utility firms, for example, Western US states provide a much higher exposure to water scarcity risks. Consequently, engagement with regulatory stakeholders will need to be conducted on a state-by-state basis with the relevant public utilities commission. Expertise in providing ESG reporting to enhance social licence to operate needs. With a history originating in South Africa, IsoMetrix is intimately familiar with the emergence of Integrated Reporting, which was first formally adopted through the South Africa King III Report on Corporate Governance in Today, the concept of financial materiality for social and environmental issues is widely accepted within the CDP (formerly the Carbon Disclosure Project), GRI, The International Integrated Reporting Council (IIRC), The Sustainability Accounting Standards Board (SASB) and other frameworks (see Verdantix: G4 Shifts Materiality To The Heart Of Sustainability Reporting). Example firms that have already published integrated reports and engaged shareholders on environmental, social and governance (ESG) issues include IsoMetrix clients such as Eskom, Transnet as well as Natref Refinery (a joint venture between Sasol and Total South Africa). Customers Seeking To Strengthen Cross-Functional And Site-Specific Visibility On Enterprise Risk Management Should Test The IsoMetrix Solution IsoMetrix plans to significantly strengthen their footprint in the Americas region and will continue to target heavy asset and infrastructure sectors that have complex enterprise risk management needs. Prospective users who will benefit the most from IsoMetrix solution are those needing to: Manage complex EHS audits and translate data into actionable tasks. Verdantix s most recent assessment of 20 EHS software vendors found that, across the 29 categories comprising 173 evaluation criteria, IsoMetrix scored strongest (2.2 out of 3.0) in audit management and sustainability management (see Verdantix: Green Quadrant EHS Software 2017). IsoMetrix also scored at least 1.8/3.0 for automated data input, configurability, employee and contractor safety management, IT security, risk management, user interface, as well as water and wastewater management. Transnet Engineering successfully deployed IsoMetrix software across 132 depots and 2 factories in South Africa, which led to a reduction in the LTIFR metrics from 1.02 per 200,000 hours to 0.42 over a four-year period among its 20,000-plus employees. It also resulted in an 83% drop in audit fees due to data automation providing a smoother, more efficient auditing process for its various sites. Engage functions outside of the EHS realm with risk analysis. The comprehensive risk-management capabilities in the IsoMetrix software such as searchable risk heat maps, controls assessment trends, multiple out-of-the-box risk assessment methodologies (bow tie, strategic impact assessment and key risk indicator analysis) and quality risk matrices are most productive when used by multiple functions collaboratively rather than silo-ed within the EHS department. Large corporates with standalone departments for quality, risk, EHS, supply chain and procurement will benefit most from accessing a centralized, collaborative platform where information can be shared and be equally accessible. For example, supplier nonconformance data can be risk-rated by impacts on schedule, cost, environment, and health and safety whilst being immediately accessible to all relevant and interested parties, whether in procurement or EHS roles. Deploy site-specific risk management tools for large capital projects. Extractives firms and their construction partners, such as Fluor, can benefit from IsoMetrix by deploying the solution on a site-specific scale to manage facility EHS performance and local social licence to 5

6 operate risks. Verdantix anticipates that site-specific data collection tools, such as mobile applications, drones and beacons, will be the key differentiator between firms who can successfully embed EHS excellence into operational activities versus those that struggle to engage shop floor and fringe users (see Verdantix: Innovative EH&S Technologies For Your 2017 Roadmap). Witness firms such as AECOM, Arcadis and CH2M exploring the potential to use EHS technologies such as drones in their service offerings for large capital projects and remediation work. Involve functions such as Investor Relations and Sustainability on stakeholder engagement and reporting for environment, social and governance (ESG) purposes. Firms looking to close the gap on socio-environmental information management between their investor relations department and shareholders will benefit from having a centralized, risk-centric EHSQ software application with strong stakeholder engagement and social licence to operate capabilities. This is particularly the case as materiality assessments expand the remit of sustainability reporting beyond NGOdriven topics like climate change, to more operational issues such as occupational health and local air pollution. Firms such as ExxonMobil and Shell increasingly face shareholder resolutions and activism on ESG issues, so it s a smart move to deploy software that can consolidate the data required to meet shareholder requests for more transparency. 6

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