EHS Management & Compliance
EHS Management & Compliance
Protecting our people, our communities and the environment is fundamentally important to the way our company operates.
We are committed to providing a safe and healthy workplace for our employees and to reducing the environmental impact of our operations around the world. Our Environmental, Health and Safety (EHS) values and commitments are detailed in our corporate policy, Respect for Environmental, Health and Safety. In addition to complying with all applicable country, regional and local safety and environmental laws, we strive for EHS performance that is among the best in the pharmaceutical industry. We have established expectations for our suppliers in our Business Partner Code of Conduct, which outlines the EHS requirements for the firms with which we do business.
As our EHS Policy states, we adhere to the following key operating principles:
- Maintain a safe and healthy working environment for all employees, contractors and guests
- Foster a culture of EHS excellence that is built on integrity, accountability, collaboration and active employee participation, and seek to continuously improve our systems, processes and standards to further support that culture
- Investigate and implement approaches to reduce the resources we use during the design, development and manufacturing of our products and delivery of commercial services, so as to minimize our impact on the environment
- Understand the potential hazards associated with our products and take action to reduce any potential risks or adverse impacts
- Promote EHS excellence in our supply chain and expect third parties doing work on our behalf to do the same. We enter into business relationships with partners that share our commitment to responsible EHS stewardship
Our EHS Management System is based on the “Plan, Do, Check, Act” model, which allows us to assess and continually improve our practices over time. The model is implemented through a set of interwoven business processes that span the corporation:
- The planning process includes development of goals, objectives and metrics based on a review of company performance, EHS programs, applicable regulations and other external factors [PLAN]
- Activities are informed by Standards, Guidelines and Tools, which are integrated into the EHS Management System, and include specific expectations for sites and operating organizations [DO]
- Governance committees, from the executive-level EHS Council through site-compliance committees, review performance and progress against objectives. Central audits and self-assessments raise issues, and our monthly and annual performance metrics reflect our progress [CHECK]
- Corrective actions and continuous-improvement initiatives are established to resolve EHS concerns that have surfaced during performance reviews, assessments, audits and routine surveillance of the regulatory landscape [ACT]
Training is critical to building worldwide employee competencies that will improve compliance, reduce risks and drive continuous improvement.
We have a global standard that defines the Environmental Health & Safety (EHS) training expectations for employees in three categories:
Managers—covers specific management responsibilities with regard to safety and environmental compliance and promoting a “safety first” culture
EHS professionals—designed to expand technical expertise and improve our EHS capabilities around the world
Overall employee population—covers the specific information our employees need to perform their jobs in a safe and environmentally compliant manner, focusing on hazards and control measures employees encounter on the job
These training programs are reviewed periodically to ensure they remain current. Our EHS training program materials are available in both instructor-led as well as e-learning formats. A mandatory course for all senior company leaders highlights the importance of EHS to the business, the critical role senior leaders play in EHS performance, and the specific actions our leaders can take to drive their areas of accountability toward EHS excellence.
Our commitment to the environment and employee health and safety begins with the company’s Executive Committee, which has established the corporate Environmental, Health & Safety (EHS) Council.
The EHS council, composed of senior-level executives representing all business units, is responsible for overall EHS governance, as well as leading and driving enterprise-wide excellence in EHS management and performance.
The Council’s responsibilities include:
- Establishing EHS strategy, policy and standards
- Providing company-wide oversight of environmental and employee safety issues, risk mitigation and control strategies
- Monitoring performance, establishing continuous-improvement targets, and recognizing and promoting EHS excellence
- Allocating resources and/or sponsoring projects to address specific EHS concerns
An EHS Standards Committee has been chartered by the Council to provide stewardship over the Standards and enable business engagement in the development of new or revised Standards. Each area of the business is responsible for executing against the Standards, contributing to the development of programs, supporting internal audits and communicating significant EHS events. Divisional EHS compliance committees have also been established to provide governance on the implementation of the Standards, and to manage, execute and resolve EHS issues as they arise.
The Vice President (VP) of Global Safety and the Environment (GSE) is responsible for communicating to the Board of Directors, the Executive Committee and the EHS Council regarding progress on goals, objectives and metrics, as well as other material issues. The VP of GSE partners with business leaders to establish long- and short-term goals and performance metrics to drive EHS excellence.
Our corporate EHS organization is responsible for:
- Developing corporate policies, procedures, guidelines, standards, tools and programs to set expectations and to support EHS compliance
- Providing technical and regulatory support to site-based safety and environmental staff and operating organizations
- Managing and implementing an internal audit program targeted at understanding the current state of compliance and identifying potential issues
- Tracking and communicating internal and external trends that should be addressed
- Anticipating, tracking and commenting on new regulations affecting our business and, where appropriate, developing plans to address them
Our site-based safety and environmental professionals around the world support the EHS needs of their business areas, which include manufacturing, research operations, sales and administrative activities, by:
- Ensuring that line management fully understands EHS requirements, including applicable regulations, permit requirements and company EHS Standards
- Establishing, assessing and improving programs
- Providing regulatory and technical support to employees and the operating areas
- Routinely assessing performance against our company standards and regulatory requirements
- Acting as the primary liaison with local regulators and inspectors
- Investigating incidents and developing corrective actions to address identified root causes
We have a detailed and rigorous corporate environmental, health and safety audit program.
Our global corporate Environmental Health & Safety (EHS) Audit Program is one way in which we identify and resolve compliance and performance issues.
- Our audit leaders are full-time professional auditors with extensive experience in auditing a broad range of EHS programs applicable to the company. Audit team members consist of EHS professionals with extensive site and subject-matter expertise. In many cases, particularly outside of the United States, our internal auditors work with independent consultants who have regulatory expertise in the laws of the host country.
- All audit findings are addressed through the development of corrective and preventative action plans, which are reviewed, approved by the audit leader and regional EHS leader, and tracked to completion
- Findings from our audit program are communicated to appropriate parts of the organization so that learnings may be shared and actions can be taken
- Audit performance and key program metrics are reviewed as part of our governance process
EHS audits of our facilities covered 73% of our manufacturing and research locations in 2016.
The audit frequency for a given facility is primarily risk-based. Manufacturing and research sites are generally audited every one to two years, depending on the type of facility, its size, and other factors. Less complex facilities, such as sales and business offices, and our warehouses, are typically audited every five years. In 2016, we performed 41 corporate EHS audits of our facilities, covering 73 percent of our manufacturing and research locations, and involving 481 auditor days of on-site review activities.
In addition to our corporate EHS audit program, our sites regularly perform self-inspections, and annually complete self-assessments of selected regulatory requirements and company standards, with all programs being evaluated at least once every three years.
Environmental management practices have evolved significantly over the past 30 years.
With research and manufacturing operations dating back more than 100 years, some of our facilities operated at a time when there were few regulations and little understanding of good environmental practices. Because our company has responsibility for remediation of these sites, we have launched investigations, developed science-based remediation plans and implemented cleanup projects to protect the health and safety of our neighbors, communities, employees and the environment, and comply with all applicable requirements. In addition, over time, we have acquired properties and manufacturing facilities that may not have been subject to the same EHS management standards that we have in place. We are also investigating and remediating those properties where necessary.
We spent $8 million in 2015 and $10 million in 2016 for remediation and environmental liabilities, including at formerly owned and operated sites. Our company has an Environmental Liability reserve of approximately $78 million to fund the continued remediation of these sites into the future. In addition, we are a potentially responsible party at 19 multiparty Superfund sites in the U.S.
Our centralized EHS information system allows us to collect, manage, learn from, and share our safety and environmental performance data more efficiently.
We collect and analyze data in both leading and lagging metrics to look for potential trends and identify opportunities that can help drive performance improvement. We continuously explore new ways to learn from and report on our performance.
Global Environmental & Safety Compliance Summary1
|NOTICES OF VIOLATIONS (NOV)/CITATIONS||2012||2013||2014||2015||2016|
|Environmental fines paid||$12,100||$1,167||$81,600||$157,270||$33,906|
|Number of environmental fines||1||1||4||7||2|
|Safety fines paid||$121,827||$3,827||$1,000||$0||$0|
|Number of safety fines||2||2||1||0||0|
|1. Previously reported data have been restated for consistency with Global Reporting Initiative (GRI) guidelines.|
NOTICES OF VIOLATIONS, FINES AND SETTLEMENTS
We report all forms of EHS compliance notices using the term Notices of Violation (NOVs), which includes citations, letters of warning and notices of noncompliance from environmental and safety-focused regulatory agencies.
In 2016, we had 180 EHS-related inspections of our facilities around the world. We received 2 safety NOVs in 2016, and for the second consecutive year, received no safety-related fines. We received 12 environmental NOVs and paid $33,906 in fines associated with two environmental incidents in 2016. Over the last five years, the total number of NOVs and fines received by our company has been trending downward, and in 2016, we saw a significant decrease in the number of environmental-related NOVs from the prior year.
SIGNIFICANT ENVIRONMENTAL EVENTS
A “significant environmental event” is defined as an environmental release that results in environmental harm to humans, aquatic organisms or wildlife, or any environmental release that requires reporting to the U.S. Securities and Exchange Commission. We experienced no significant environmental events in 2016.