Russians Call for Stronger Regulation of Ships After Major Oil Spill

Although Russia will likely become wealthy over the long-term because of its oil reserves, the Russian government is going to slow that process to make sure no more oil spills happen like the one that caused $267 million in damages to the Kerch Strait earlier this month. A major oil spill in the Baltic Sea polluted a 30-mile stretch of water, killing birds and fish.

As a result, Russian officials will limit oil products shipped by river in 2008 by disallowing barges that are more than 25 years old. Because Russia has an industrial economy dating back to the Soviet Union, much of the oil industry’s equipment is aging.
“The fleet must be young. We will subject ship owners to such conditions that it will become unprofitable to use barges older than 25 years,” Alexander Davidenko, head of RosRechMorFlot, the river navigation agency, told Reuters.

According to oil industry spokespersons, this move will cut shipments by 70-80 percent below the customary 5-million ton level. The oil industry is not happy, suggesting that the government may be overreacting to the spill by over regulating the industry without doing sufficient research. They believe that there may be other ways to deal with the fallout without requiring major investment in new equipment.

Many of the oil companies we deal with have already put in place an integrated EHS software platform that enables managers to monitor and report such spills and correct problems with equipment before those problems erupt into crises.

Even though major oil spills are rare, organizations still need to be prepared to provide rapid and robust emergency response in order to minimize the potential ecological impact from these kinds of incidents. There’s plenty of motivation to do so, as investors are always closely examining companies’ ability to prevent or mitigate operational risks. Having a proactive crisis response plan, supported by a crisis management technology, can go a long way to protect the interests of the company and the community.

There are also rumors of a coming ban on floating storage facilities. When Russian rivers freeze in the winter, oil is stored in floating facilities until the spring thaw when it can be transported again. These facilities, if they are monitored correctly with crisis management reporting systems that support measures to prevent spills, could have their useful life extended without endangering rivers and seas.

If oil company barges would use the right kind of reporting and monitoring systems, it would be good news to the developed world, because we need the oil and the Russians need to sell it.

Add comment November 26th, 2007

ESS Crisis™ Enables Teams to Streamline Response at Major Terrorism Exercise

Several months before OPERATION TOPOFF 4, an incredibly complex terrorism preparedness exercise, the Tempe, Arizona Fire Department selected the on-demand version of ESS Crisis™ to manage its daily planning and emergency event mitigation at the city’s emergency operations center. Tempe Fire Department was an important customer win for us, not only because our own headquarters is located in Tempe, but because it gave us a chance to try out our SaaS product in a very important context.

TOPOFF 4, which took place October 15-24 at several venues in Arizona and Oregon, was designed to strengthen the nation’s capacity to prevent, protect against, respond to and recover from terrorist attacks involving weapons of mass destruction (WMD). The exercise provided an opportunity for local, state and federal agencies to coordinate emergency preparedness efforts among 10,000 participants, including officials from Arizona and Oregon; overseas support from the United Kingdom, Canada, Australia and Guam; and with the full-scale tests of collective preparedness and interoperability.

During last month’s exercise, imaginary radiological incidents occurred in Tempe/Phoenix, Portland and Guam. Local officials were tasked with coordinating and executing proper responses to the incidents using effective communication and coordination among various levels of government agencies and private responders. Federal, state and municipal agencies had to work together in this test. Once the exercise was complete, the Department of Homeland Security evaluated the Tempe responder team’s performance and gave them a report card in an effort to improve the City’s preparedness and incident management.

A growing number of local first responders like those in Tempe and Gilbert, another Phoenix-area suburb, have automated their pre-event preparedness and onsite coordination. Exercises like TOPOFF 4 are a powerful reminder that interagency coordination and system interoperability will be key factors to ensure that future terrorism response efforts are to be successful. Departments both large and small will need automated tools like Crisis to ensure they will be ready when a major incident occurs. In a real crisis, it could turn out to be a lifesaver.

Add comment November 15th, 2007

Wal-Mart Leads Retail Shift toward Sustainability Brand

If you deal with Wal-Mart in almost any way, you probably already know that the company has changed its brand from “Everyday Low Prices” to “Save Money, Live Better.” Can you imagine how much it must have cost the company to re-brand in order to include some sustainability projects in its brand? I’m sure it’s a big number. But Wal-Mart basically bet the farm on sustainability, health and wellness, community, economic opportunity and value as its five key initiatives.

Health and wellness kicked off with $4 prescriptions. In conjunction with its huge sustainability initiative, Wal-Mart recently held a conference in which it brought together CEOs from all over the country and announced that it was going to green its supply chain. That means if your company is a Wal-Mart vendor, or if you want to be one, first you must meet the company’s sustainability objectives.

That’s huge because Wal-Mart interacts with 80 percent of the households in the U.S. Anything Wal-Mart does affects most consumer brands and most manufacturers. For example, Wal-Mart now sells a reusable shopping bag for $1 that is made from 85 percent recyclable materials, carries the same weight as a plastic bag and replaces 50 plastic bags in its lifetime.

Six months ago Wal-Mart launched the “Live Better Index” to track its efforts.
The index charts the habits of American households in five major areas, including sustainability. At the six-month mark for the index, Wal-Mart reported that Americans had already purchased 100 million compact fluorescent light bulbs for a $1.5 billion savings on their electricity bills.

Why is this so important? Because Wal-Mart has already found that sustainability is not only cost effective, but it saves consumers money. And now they have decided that they are also going to save themselves and their supply chain money by extending their sustainability initiatives rather than drawing back from them.

The example of Wal-Mart is why I believe the enterprise will lead the way to solutions that go significantly beyond the nuts and bolts of GRC and into the important territory of innovation.

Add comment November 8th, 2007

Think Tank Report Provides Best Practices for Business GHG Strategy

Last year, the Pew Center on Global Climate Change released a very interesting report called “Getting Ahead of the Curve: Corporate Strategies That Address Climate Change,” which shows how large corporations are getting ahead of the regulatory curve and developing their own strategies to deal with climate change.

About a year old now, the report shows just how far ahead some of these companies have been in calculating their response to GHG emissions and shifting from reactive to proactive. When you realize that this study was released before Al Gore won the Oscar, the Emmy or the Nobel Peace Prize, you have to understand that what I’ve been trying to say about innovation in the enterprise dated from long before Gore’s film, An Inconvenient Truth bludgeoned unwary consumers with melting polar ice caps.

Of course the large multinationals were aware of the conditions before the average guy: they operate globally in the forests, rivers, skies and oceans, and they see the effects of climate change firsthand. And far from being cold and uncaring, large corporations with strategic plans know that if they don’t do something, their businesses will not be sustainable.

So they have sought to get out ahead of public policy, not for their financial gain, but for their very survival.

The report describes eight steps to a climate strategy: assessing emissions and exposure
to climate-related risks, gauging risks and opportunities, evaluating action options, setting goals and targets, developing financial mechanisms, engaging the organization, formulating policy strategy and managing external relationships. These steps are not always taken in the same order.

There are four main lessons from this study. The first is the importance of strategic timing. Though some companies thought they started too early, most feel they can’t afford to start too late. The second, related lesson is developing an appropriate level of commitment. Committing too fast to a strategy might position a company poorly if the regulatory environment develops in a different direction. As an enterprise, you have to do the things YOU think are right, and still have resources remaining to do what the government may require.

The last two conclusions are obvious. They are to become involved in policy formation and try to exert some influence over it, since the marketplace knows where the biggest risks are – it’s our job to keep our businesses alive by assessing risk correctly. And then to create business opportunities from these risks and policies; I talked about the last time.

Add comment November 2nd, 2007