SMEs in Africa must focus on health and safety in the workplace

Feb 24, 2023 11:08:02 AM

"The focus in the business world in recent years on the application of ESG standards means that there should be a far greater focus on OHS in the workplace."

By Brondwyn Douglas, Senior ESG Officer at Spear Capital

According to the World Health Organisation, over 1.1 million people die of occupational injuries and work-related diseases worldwide each year. That’s quite a shocking statistic. In addition, the risks in workplaces that can cause bad health among workers and the community are approximately 10 to 20 times higher in developing economies. In these environments, as few as 10% of workers have access to occupational health services.

This is particularly true in Africa. The continent is highly industrialised, and industrial manufacturing carries a far greater risk of injuries than, say, the services sector. In addition, many of the sectors on the continent that propel the economy are labour intensive, increasing the risk of occupational incidents and injuries if health and safety is not prioritised.

This is specifically the case for businesses classified as small- and medium-sized (SMEs), since the situation is more severe among them than in the corporate and multinational sector. Where the business is very large, it faces far more regulation and usually has the resources available to implement the necessary measures, but this is not true of SMEs.

A concern is the lack of enforcement of health and safety policies. When an SME knows that there is little chance that their occupational health and safety (OHS) practices will be audited or assessed by the authorities, the business is less likely to focus on this element.

The focus in the business world in recent years on the application of ESG standards means that there should be a far greater focus on OHS in the workplace. The ideology around ESG today is essentially to do no harm. That’s why health and safety is a fundamental element of ESG: it ensures that everyone’s right to an environment that is safe to live and work in is protected.

In recent years, however, an unexpected event like the COVID-19 pandemic brought occupational health and safety into the limelight once more, with businesses having to make some hard decisions about operational practices, geared to limit the risk of the workplace becoming a site of infection. The pandemic reminded the business community of the risks of reputational and financial damage if we do not focus sufficiently on health and safety.

There are various actions that SMEs should take in order to position OHS as something of significance for the business. Here are a few key actions:

Ensure senior management buy-in to OHS and make resources available for its implementation
Understand the risks associated with tasks, equipment and the workplace environment and build in measures to mitigate these
Constantly train staff. Use a variety of methods to achieve this and make use of competency assessments to gauge the understanding and knowledge among staff
Reward safe behaviour to build and reinforce a positive OHS culture
Capture data on:

- Incidents, so that you can identify where there are weaknesses in the OHS system

- Near misses, so that you can assess where new or revised mitigation measures may be required. This is a leading indicator and can be crucial in preventing an injury from occurring.

Beyond the need to meet compliance requirements, there may be other reasons for a business to apply a stronger focus on OHS. Businesses that need investment in order to expand may look to private equity firms. In addition to the capital that a private equity investor may bring to the business, there is also significant support and knowledge that is made available, and this may play an important role in helping the business to enforce compliance with health and safety standards. The investor can demand strict adherence to OHS requirements before the business is able to access finance. This would ensure that organisations with a high number of reported fatalities, injuries and incidents would lose out on much needed funding - thereby incentivising their improvement of health and safety practices.

Private equity investors scrutinise management's attitude to OHS: where the business has the potential and willingness to improve, PE firms will be well-placed to positively impact the business over the long term through supporting the business on its road to improving its safety record and on-the-ground performance.

This article originally appeared in the 6th edition of ESG. Enjoy your complimentary copy:

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