NETCARE LIMITED CORPORATE GOVERNANCE ENVIRONMENTAL POLICY POLICY NUMBER SUST1 PREPARATION DATE AUGUST 2012 ISSUE DATE AUGUST 2014

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1 NETCARE LIMITED CORPORATE GOVERNANCE POLICY NUMBER SUST1 PREPARED BY APPROVED BY PROPERTY DIVISION CORPORATE GOVERNANCE PREPARATION DATE AUGUST 2012 ISSUE DATE AUGUST 2014 REVISION DATE AUGUST 2016 VERSION 3 (2014)

2 COPYRIGHT WARNING NOTICE This policy and procedure is the property of Netcare Limited. Copyright subsists in this work. Any unauthorised reproduction, publication or translation of the work are acts of copyright infringement and may lead to criminal prosecution. The compilation and input to the guide was obtained from experts in the field. Any changes and alterations can only be made with the approval of the authors. Reference to one gender can be interpreted to imply belonging to either gender. Any deviations from this policy and its supporting standard operating procedures require the approval from the assigned approval committee. All deviations, comments and suggestions could be ed to Page 2 of 15

3 1. POLICY STATEMENT POLICY SCOPE RISKS REFERENCE DOCUMENTS LEGISLATION SOUTH AFRICAN NATIONAL STANDARDS OTHER DOCUMENTATION DEFINITIONS MANAGEMENT OF ENVIRONMENTAL ASPECTS PLANNING OBJECTIVES ROLES AND RESPONSIBILITIES MASTER POLICY Energy Water General waste Medical waste Hazardous substance Emissions Environmentally Preferred Purchasing (Green Procurement) Green buildings and premises TRAINING, AWARENESS AND COMPETENCY RECORD KEEPING COMPLIANCE MONITORING AND AUDITING PERFORMANCE MANAGEMENT REVIEW REPORTING ASSESSMENT Page 3 of 15

4 1. POLICY STATEMENT Netcare is committed to conduct its operations in a manner which will sustain environmental and human health. Our goal is to conserve and protect environmental resources across our operations, services and supply chain. Netcare subscribe to the intent of the Kyoto Protocol and participate for that reason in the Carbon Disclosure Project as well as the Global Reporting Initiative (GRI) and Johannesburg Stock Exchange SRI Index. Netcare s facilities will be required to improve their environmental performance through effective use of all resources and efficient management to minimise any adverse impact on the environment. All operations in the Group sign up for the following commitment: i. Establish our commitment towards the environment, by holding our leaders accountable for the environmental performance of the operations. ii. Develop and maintain an environmental management system to implement the environmental strategy, policy, procedures and monitor performance iii. Assess all current and planned operations that have an environmental impact and set objectives with a review process to eliminate, reduce or mitigate the impact on the environment iv. Enforce statutory and health care specific compliance. v. Establish Netcare best practice standards to meet the objectives of the Environmental Policy vi. Create and abide by a preferred supplier/procurement policy (or Include environmental parameters in the current policy/sla) to encourage our contractors, suppliers and service providers to adopt similar environmental standards vii. Reduce the carbon footprint and Green House Gas Emissions of all Netcare Group facilities and operations by reducing harmful emissions through efficient and effective use of resources viii. Reduce water dependency and usage by efficient operations to reduce the impact on the water system Page 4 of 15

5 ix. Minimise waste by ensuring efficient operations and actively promoting reduction, reuse and re-cycling of waste throughout the value chain x. Review our environmental strategy and measure our performance on a regular basis to ensure objectives are met and business goals are in support. The Group Leadership and Operational Leadership commit to the following: i. They will provide leadership and resources to change behaviour and develop employee skills to ensure a culture of continuous improvement is created ii. Communicate initiatives and performance to employees and external stakeholders such as government, shareholders, investors and public to ensure environmental awareness is increased and reporting requirements are met 2. POLICY SCOPE The policy applies to all Netcare Group South African operations, PPP s and Joint ventures. It is applicable to all persons employed by Netcare, full-time and part-time contracts, suppliers and tenants that carry out activities and tasks on any Netcare premises 3. RISKS Failure to manage and ensure sustainable use of natural resources can have serious negative effects on an organization's financial well-being and its ability to achieve its business objectives. Failure to adhere to legislation and regulations, as well as governance and accounting trends, can influence an organization's financial performance, reputation and brand, cash flow, and shareholder value. 4. REFERENCE DOCUMENTS 4.1 LEGISLATION i. Atmospheric Pollution Prevention Act (Act 45 of 1965). ii. Integrated Pollution and Waste Management Policy, iii. National Energy Act, 2008 (No 34 of 2008). iv. National Environmental Management Act (Act 107 of 1998). v. National Environmental Air Quality Management Act (Act 39 of 2004). Page 5 of 15

6 vi. National Environmental Management: Waste Act (Act 59 of 2008). vii. National Health Act (Act 61 of 2003). viii. National Road Traffic Act, 1996 (Act 93 of 1996). ix. National Water Act (Act 36 of 1998). x. Occupational Health and Safety Act (Act 85 of 1993). xi. Local authority laws and bylaws. 4.2 SOUTH AFRICAN NATIONAL STANDARDS i. SANS Energy efficiency in buildings. ii. SANS Energy management specifications. iii. SANS The identification and classification of dangerous goods for transportation by road and rail modes. iv. SANS & 2 - Management of healthcare waste. v. SANS National Building Regulations. vi. SANS Environmental management systems. 4.3 OTHER DOCUMENTATION i. Energy policy (Under development for publication in Quarter ) ii. Water policy (Published) iii. General waste policy (Published) iv. Medical waste policy (Published) v. Hazardous substances (Published) vi. Emissions (to be developed for publication in Quarter ) vii. Environmentally preferable purchasing policy (to be developed for publication in Quarter ) viii. Green buildings and premises policy (to be developed for publication Quarter ) All Acts are available at: SANS documents available from the SABS; other documents available on the Netcare Public drive under Environment, local municipal legislation available from local authorities. 5. DEFINITIONS For the purpose of this policy, the following definitions and abbreviations shall apply: Page 6 of 15

7 i. CDP - Carbon Disclosure project ii. Environmental Management System (EMS) - An EMS is defined as a selfcorrecting and continual improvement system that seeks to reduce environmental impacts associated with a facility's activities while helping to ensure compliance with environmental regulations. It provides a structured method for incorporating environmental considerations into day-to-day operations while promoting continual improvement of the environment and human health iii. Global Reporting Initiative (GRI) - A non-profit organisation that promotes economic sustainability. It produces one of the world's most prevalent standards for sustainability reporting iv. ISO - International Organisation for Standardisation v. Johannesburg Stock Exchange SRI Index -The SRI Index provides criteria to measure the triple bottom line performance of companies in the FTSE/JSE All Share Index vi. King III - Refers to the King Code of Governance Principles for South Africa 2009 and the King Report on Governance for South Africa 2009 vii. KPI - Key Performance Indicators viii. Health Care Waste (HCW) - Includes all waste generated by healthcare facilities, i.e. general waste and hazardous waste ix. Netcare Group - Netcare Group of Companies in Southern Africa including all JVs. x. Policy - A formal statement of intent that mandate principles or standards that applies to the Company s governance or operations. xi. Procedure - The Company s requirements for a particular course or mode of action to produce a desired result and outcome. xii. PPP - Public Private Partnerships xiii. Remedial Action Plan (RAP) - Activities to be undertaken to close out audit and incident findings xiv. SANS - South African National Standards Page 7 of 15

8 6. MANAGEMENT OF ENVIRONMENTAL ASPECTS This environmental policy expresses the overall principles in relation to the Netcare environmental performance and provides a framework for actions and setting the environmental goals. This policy must be read and implemented in conjunction with the applicable legislation (see 5.3.1), the SANS documents (see 5.3.2) and related policies (see 5.3.3). 6.1 PLANNING Netcare shall ensure the availability of resources to establish, implement, maintain and improved the environmental management system and that these resources are sufficient to achieve the objectives of the environmental plan. The environmental management system will comply with the requirements of the ISO code of practice for environmental management systems. 6.2 OBJECTIVES In order to sustain environmental and human health, Netcare will: i. Establish Environmental Management Committees/Teams at all facilities to manage the development of environmental management plans, support the implementation of an environmental management system and audit conformance to the plan and system. ii. Ensure operations are compliant with national, provincial and local legislation. iii. Identify and assess all environmental impacts of the operations iv. Reduce and eliminate where possible the use of any materials which are known to cause harm to the environment v. Invest in technology, equipment and give preference to environmentally friendly products and suppliers vi. Provide staff with training and guidance in the maintaining of the environmental plan and system. 6.3 ROLES AND RESPONSIBILITIES i. The Corporate Governance and Quality Leadership Department in conjunction with Executive and Senior Management will remain responsible. It will assign the review of the environmental policies and all related standard operating procedures and Page 8 of 15

9 guidelines in line with the compliance framework. Audits of the facilities will be undertaken to establish conformance to the respective plans, policies and procedures to ensure sustainability of the Group s efforts to maintain good standing in the impact to the environment by the members in the Group. ii. The facility manager shall retain overall responsibility for the management of the Group s Environmental Policy at facility level. iii. The respective CEO s shall accept overall responsibility for each business unit to adhere to the Group environmental management system and plan. iv. The General Managers are responsible to ensure that the policy is understood and supported in their departments through: a. Participating in the setting of environmental objectives and targets during the management meetings; b. Deriving departmental objectives and targets from the environmental management policy where appropriate; c. Involving personnel in programs to achieve the objectives and targets. v. Each facility shall establish an Environmental Management team/committee, chaired by the facility manager. Ideally the team should consist of: a. Catering Manager b. Infection Prevention Nurse c. Financial Manager d. Housekeeping e. Nursing Manger f. Occupational Health Nurse g. Pharmacy Manager h. Procurement department i. Radiation HOD j. Unit Manager k. Technical Services Manager vi. These roles and responsibilities need to be negotiated and allocated at facility level. The committee s responsibilities are: a. Providing leadership and resources to ensure the required awareness and capacity is available to implement the Group s environmental plan and policy Page 9 of 15

10 vii. viii. b. Ensuring staff receives relevant training and education c. Reporting environmental data on a monthly/quarterly basis to measure Facility performance d. Legal compliance to national and local laws is adhered to. e. The necessary risk management is implemented to eliminate, reduce or mitigate risks to the environment. Any incidents must be reported and investigated f. Ensure waste minimisation by applying reduction, re-use and re-cycling principals. The committee must provide guidelines to ensure waste weight/dimensions and type is being recorded,, appropriate records are being kept, destruction certificates where appropriate are received and filed according to legal requirements g. Monitor the energy and water usage of the facilities to develop action plans to ensure increased usage efficiency h. Development and escalating of innovative ideas and participate in forums to share best practice in order to establish a culture of continues improvement i. An annual/quarterly environmental audit is conducted j. Submitting an annual environmental report (see attached template) to the Sustainability Committee All facilities shall have an Environmental Management Plan. This Environmental Plan shall support Netcare s voluntary or compulsory contribution and subscription to CDP, JSE SRI and GRI participation and submissions. All contractors and suppliers (including doctors) on the premises should be made aware of the policy. This will be reinforced in the Technical policies of the Group. 6.4 MASTER POLICY The environmental policy is a master policy supported by a group of policies on subject matter specifics. The implementation of the policy should therefore be done in conjunction with the following policies and procedures: i. Energy policy ii. Water policy iii. General waste policy Page 10 of 15

11 iv. Medical waste policy v. Hazardous substances vi. Emissions vii. Environmentally preferable purchasing policy viii. Green buildings and premises policy A statement of fact of the related policies is provided below. The relevant policy should be studied for further details Energy The energy policy is under development and is planned for publication by Quarter 4 of This policy influences the use of electricity, fossil fuels and other synthetic fuels to limit adverse impacts on the environment and also measuring, managing and reporting of energy use and the release of toxic or hazardous gasses into the environment to limit the emission of greenhouse gasses and will instruct the business about the use of sustainable and renewable sources. The Group strategy is committed to reducing its carbon footprint and is reviewing and investigating a host of energy interventions to enhance this process. Each facility shall have an energy management plan and shall be audited to verify adherence and achievements Water The water policy is under review and is planned for publication by Quarter 3 of The water policy shall instruct the business regarding the management and reporting of water for general use, irrigation purposes and will assist the facility managers to manage the following: i. Metering of water uses and reporting purposes of use. ii. Use of water and reporting of this water usage to track and manage usage and recording and reporting savings. iii. Guidance about the use of ground water and rain water harvesting. iv. Water quality fit for use in health care facilities. v. Water conservation methods and targets Page 11 of 15

12 vi. Sewage and disposal of trade effluent. Each facility shall have a water management plan and shall be audited to verify results and implementation General waste The general waste policy is planned for development and is scheduled for publication by Quarter 3 of The general waste policy will be supporting the hazardous material and medical waste policies and shall assist the business in the following: i. Reduction of waste. ii. Recycling of waste iii. Identification of waste and optimizing of segregation of waste. iv. Reduction of impact on landfill sites v. Identifying, measuring and reporting the waste generated for each waste stream. Each facility shall have a waste management plan and shall be audited to verify implementation and results Medical waste All facilities will have a HCRW plan as required by the Healthcare Waste Management Act. All activities and developments will be coordinated by the Health Care Waste Executive Management Team to prevent or minimise harm to patients, staff, communities and the environment. There will be a system in place to record the number and weight of all HCRW containers leaving the facilities premises. Safe disposal certificates must be issued by the service provider within 40 days of collection to ensure proof of destruction Hazardous substance The current policy referring to hazardous substance is limited and will be review before published. The policy is scheduled for publicity in Quarter 3 of The policy will be expanded to cover waste that has significant adverse (toxic) effects on public health and the environment through improper storage, transport, treatment or disposal. For example, waste with high heavy metal content, batteries, broken Page 12 of 15

13 thermometers, blood pressure gauges, pressurized containers, aerosol cans, gas cylinders, gas cartridges, HEPA filters, fluorescent tubes, etc. Further to the above definition, hazardous healthcare waste is classified in accordance with SANS into Classes 1 6 and is dealt with under a specific policy for Health Care Risk Waste Emissions This policy is scheduled for development to be published in Quarter 4 of The terms and references for this policy needs to be determined, but will refer to the Group s voluntary participation in JSE SRI, GRI and CDP reporting initiatives and shall govern how information shall be collected from facility level, how facilities are supporting the bigger Group reporting and how this management of emissions is supporting Netcare to being acknowledged as a responsible corporate citizen. The emissions policy will also instruct regarding harmful emissions and how to minimize the impact, record the use and enable responsible management of the impact on the environment Environmentally Preferred Purchasing (Green Procurement) This policy is scheduled for development to publish in Quarter Environmentally Preferred Purchasing (EPP) principles will be applied when products and services are procured. These are products and services whose environmental impacts have been considered and found to be less damaging to the environment and human health when compared to competing products and services Green buildings and premises The policy for green building and premises is to be developed in 2014 and is scheduled for publishing in Quarter 3 of Netcare will develop its own green building guidelines, which is intend to implement on new building projects, renovation, refurbishments, etc. Page 13 of 15

14 6.5 TRAINING, AWARENESS AND COMPETENCY Facility and departmental managers are responsible to ensure that training programs provide for awareness and competency of all personnel with regards to: i. The importance of the environmental policy and environmental management system; ii. Significant environmental impacts of their work activities and the environmental benefits of improved personal performance; iii. Their roles and responsibilities in achieving conformance with the requirements of the environmental management system; iv. The potential consequences of departure from specified operating procedures. 6.6 RECORD KEEPING Records of environmental activities must be maintained to demonstrate conformance to the requirements of the management systems. 6.7 COMPLIANCE This policy requires full adherence to any Law, National Regulation and or Local Authority By-laws, including any amendments, pertaining to environmental activities. They include but are not limited to those mentioned in Section 4 and the related policies. Netcare shall implement a procedure to ensure continuous compliance to regulations and policies and standards and where corrective action is required for any non-conformity that such is taken. 6.8 MONITORING AND AUDITING The key characteristics of operations and activities listed in the EMS aspect register must be monitored and measured according to the requirements of the relevant procedures. The EMS is internally audited on a regular basis to ensure continuous compliance to regulations, policies and standards. Remedial action plans (RAPS) will be developed to manage any non-conformity. 6.9 PERFORMANCE Netcare shall ensure an environmental management strategy is developed to ensure KPI s are identified and targets are set to achieve the environmental goals. Included in these goals will be an objective to reduce the Group s carbon footprint. The environmental management plan will be reviewed annually to ensure alignment with business objectives and strategies. Page 14 of 15

15 6.10 MANAGEMENT REVIEW Netcare shall implement a procedure for a management review of the environmental management system to ensure its continuing suitability, adequacy and effectiveness. An aspect register will be created and according to the risk rating an Environmental Management Programme will be established based on the priority, outlining the objectives and targets REPORTING The policy must be aligned with reporting requirements as required by: i. Johannesburg Stock Exchange SRI Index; ii. Global Reporting Initiative; iii. Carbon Disclosure Project; iv. Netcare Annual Report and its annexures. 7. ASSESSMENT Management is defining an environmental self-assessment tool that will be completed by all business units on a quarterly basis to ensure the important requirements of the policy and procedures are adhered to. A third-party audit and/or a quality review will be undertaken every 24 months. Page 15 of 15