Regional Internal Audit Workshop Recap & Lessons Learned

Transcription

1 Regional Internal Audit Workshop Recap & Lessons Learned Caroline Kramer, Jake Taylor, Peter Downing March 28, 2019

2 What are Regional Workshops? Hosted by NACD Member or Affiliate Companies Limited attendance, averaging attendees Provides an opportunity for a deep dive into topics with a hands-on learning approach Personal interaction with NACD Staff, Advisers, Mentors and most importantly your PEERS! Thank you to our most recent Internal Audit Workshop hosts!

3 Internal Audits NACD Responsible Distribution ISO 9001, Required by: OHSAS ACC Responsible Care Management System (RCMS) & RC High NonConformance Rate: Code X routinely lands in the top five most cited Codes!!

4 Remember why you Audit Identify gaps for improvement Monitor and review adherence with Responsible Distribution's Code of Management Practice Initiate Corrective and Preventive Actions (CAPAs) Assess organizational culture and process maturity Continuously improve management, operations, and performance Prevent surprises or EHS&S disruptions Create consistency across multiple sites and locations Document and leverage institutional knowledge Prepare the company and its employees for site verification

5 Understanding Code X 10.A. Describe the member company s documented procedures for scheduled internal audits that verify implementation of the member company s policies and procedures supporting the Responsible Distribution Code of Management Practice. These audits shall be conducted on an annual basis at each location used by the member company for the distribution of chemicals to evaluate the effectiveness of the policies and procedures and conformance with the Responsible Distribution Code of Management Practice. Annual Basis! Key Elements All Locations! All 13 Codes!

6 How do you do it? Plan & Prepare! Identify Resources Senior Management involved Time, responsibilities Select Internal Auditors Who is the best person for the job? Observant, Perceptive, Diplomatic, Decisive, Ethical for the Communicate Expectations auditor and the Responsibilities auditees Identify Scope/Criteria of Audit What are you actually going to audit and how?

7 Examples Take the information available in the Guidance & Specification Document, and use as a guide when completing your Internal Audits. 3.A. Describe the process for selecting carriers to transport chemicals that includes carrier safety and fitness, security, and regulatory compliance, including ongoing performance review. Examples of Conformance Completed approved carrier checklist? DOT s carrier safety rating? Transportation incident record? Verification of compliance with EPA Standards applicable to Transporters of Hazardous waste? Y N Notes

8 Examples 5.B. Describe the site s established procedures and work practices for safe operating and maintenance activities. Procedure Description Our company has dedicated environmental, health and safety personnel. These personnel regularly attend industry association meetings and receive publications. Various policies, standard operating procedures and work instructions, are regularly reviewed with employees, as indicated on the Training Matrix. The Safety Committee, which is comprised of personnel from various departments, meets on a monthly basis, and monthly safety meetings are conducted with all staff. Meeting minutes are recorded and retained. A company newsletter, which includes safe operating and maintenance activities, is periodically provided to employees. Procedure Reference NACD Responsible Distribution Manual, Code 5, Job Procedures and Training SOP for Loading and Unloading Outside Contractor Safety Expectations Health and Safety Manual PPE Requirements Training Matrix Monthly meeting minutes PM Schedules and PM Records for all Equipment and Vehicles Building Inspection records Safety Cabinets Inspection and Inventory forms Take your 6th Cycle Specifications and pull out all the document references for each code, possibly creating a matrix, and use that as a guide for your internal audits.

9 Examples Audit by Document: Emergency Response/Action Plan Is the Policy/Procedure controlled and included in the master list (Code XII)? Has Senior Management reviewed & signed off (Code I)? Cross reference in Guidance & Spec: Code IV. K Code VII. B, D, & F Code XIII. B, C, H, I & M Result: You can internally audit ~5 Codes with one document. Audit by Functional Area: Contractor Program Use a functional area of your business as your audit guide What areas are affected by a Contractor Program: Applicable EHS&S Regs (Code II.E) Transportation/Carriers (Code III.A) Product Handling & Storage (Code IV. B & G) Training (Code V.E, VII.B, XIII.F) Communication (IX.B, XIII.G) Result: You can internally audit ~7 Codes with one functional area.

10 Conducting the Audit Visual Inspections Announced & Unannounced Take Notes! Listen to your gut but trust your eyes Document Reviews Audit against current controlled documents only! Give sufficient notice for doc requests Review both electronic & hard copy Interviews Conduct at all appropriate levels Be a good listener Don t become the auditee Don t make assumptions Communication is Key!

11 Types of Questions If you don t ask, they typically won t tell. Think about how you are phrasing questions during an interview Open Questions What is your process to qualify customers? Closed Questions Lean to discussion and Lead to definitive Yes further probing or No answers Allows the opportunity Can be effective but for the auditee to guide use judiciously you through the process/system Did you preform an annual Internal Audit in 2017?

12 Completing the Report What should you be documenting? Are you doing what you say you are doing? Inconsistencies Non-conformances Best practices Opportunities for improvement How are you documenting? Are you providing sufficient details? Is it clear what the nonconformance is? Will others understand the findings? How you document will be important when determining the Root Cause!

13 Audit Results Opportunity for Improvement NonConformance

14 Corrective Actions Follow through with them! Make sure to assign them to the appropriate people Senior Management needs to be involved: review and sign off (10B!) Code XI: Corrective and Preventative Actions Corrective action should support the immediate problem but also put in place requirements to prevent recurrence.

15 Root Cause Caution: The Quick Fix Sometimes necessary (safety related issues) Follow through to make sure the corrective action did in fact resolve the issue and prevent reoccurrence Revisit periodically, 6 months 9 months 12 months to ensure effectiveness Repeat findings: Why? Dig deeper Did you identify the correct root cause? You might be auditing against policies, not real life. Are your policies correctly reflecting what is being done in real life (what is bring done in practice)?

16 Take-Aways from IA Workshops Responsible Distribution requires audits of ALL 13 Codes as ALL locations (owned and contracted warehouses) on an ANNUAL basis. Combine RD Internal Audits with others (i.e. ISO, RCMS, Risk Control, etc.). Make sure to cover all 13 Codes! *comparison guides available on website Using information already available to you to create your IA templates - you don t need to re-invent the wheel. Share audit results with entire team (including Senior Management) and use them to do trend analysis of nonconformances.

17 Take Aways from IA Workshops Think about creative ways to utilize resources available to you to complete audits. Set a schedule or action plan with planned dates and assign responsibilities. Training additional staff (i.e. sales) to assist on warehouse audits when making sales calls and make sure they understand the Responsible Distribution requirements. Keep in mind CC transitions and avoid gaps in audit schedule (train backups!).

18 Auditing rd 3 Responsible Distribution Verified Already performing Internal Audits of all 13 Codes Still needs to be included in your yearly Internal Audit for all sites Visit facility! Party Warehouses Check for any other Management Systems (ISO, RCMS) Educate 3PL on Responsible Distribution Make sure to cover all codes Visit facility!

19 Questions?

20 Contact Info. Caroline Kramer NACD Manager Responsible Distribution Jake Taylor Kestrel Management, LLC Senior EHS Consultant Pete Downing Environment & Safety Solutions, Inc. President