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What compliance reporting do Executives need?

14 November 2022

4 min read

#Transport, Shipping & Logistics

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What compliance reporting do Executives need?

Executives have an independent and personal duty to exercise due diligence to ensure that their business complies with its safety duties under the Heavy Vehicle National Law (HVNL). This duty is set out in section 26D of the HVNL.

‘Executives’ are directors, partners and any person engaged or concerned in the management of a legal entity.

Section 26D(3) of the HVNL sets out that ‘due diligence’ by the Executive includes taking reasonable steps to:

  • understand what/how transport activities are conducted
  • understand the hazards/risks involved
  • understand how to conduct transport activities safely
  • ensure that appropriate resources are engaged to help eliminate/minimise those hazards/risks
  • ensure processes implemented to:
  • eliminate/minimise those hazards/risks
  • receive and consider information about those hazards/risks
  • respond to that information
  • comply with the business’ primary duty
  • check that the resources (money, people, equipment, systems etc.) and processes are implemented, followed and effective in eliminating/minimising identified hazards/risks.

Part of an Executive’s due diligence includes receiving and acting on information about the HVNL risks and how the business is performing in eliminating or reducing those risks. That means that the Executive needs some form of HVNL compliance performance reporting.

Ideally, such reporting should be in a form that is able to be understood easily and acted upon – so some form of summary dashboard style reporting is recommended. Other recommended features of HVNL Executive reporting include:

  • exceptions-based

Reporting should focus on the problem areas that need the attention and action of the Executive. Don’t inundate the Executive with every piece of data, as the areas requiring their action will get lost in the tide.

  • lead and lag indicators

Include reporting on the performance as against proactive/preventative measures that the business is implementing (such as including HVNL compliance conditions in all third party contract renewals), as well as metrics on past incidents

  • capture ‘near-misses’ as well as ‘incidents’

A detected and corrected ‘near-miss’ still indicates a failure or weakness in the compliance management framework – maybe the policy or practice hasn’t been communicated, or not clearly enough, or the training is not sufficient, or people aren’t following the practice, or the practice is ineffective and needs to be redesigned. So, near-misses should still be reported.

  • capture other parties’ performance?

Where you exercise responsibility or control over the activities of a third party (e.g. a transport contractor that you engage and direct, to supplement your own fleet), you should capture the compliance performance statistics of that third party as well, as you will likely be responsible for their compliance mis-steps.

Capturing such information also assists with your contract performance management of third parties. If you can identify that they have failed to meet compliance standards, this gives you a starting point to engage with them to improve their performance and reduce the risk of further problems arising.

  • include trend analysis

It is no good to simply report that five, seven or 50 incidents occurred, without any indication of the businesses’ performance over time. Some form of trend analysis is required so that the business and Executive can see whether, over time, the measures implemented are being effective. Trend reporting also enables the business and Executive to identify unexpected spikes in compliance incidents or dips preventative measures that could indicate a major problem needing urgent attention. 

The Executive should receive such reporting at least quarterly, but there is nothing wrong with more frequent reporting (e.g. monthly). An exception to this is any very significant incident or unexpected spike or dip in performance, which could indicate that more immediate responsive action is required by the Executive.

Information is key to the Executive being able to discharge their HVNL duties. Executive compliance reporting is one of the best ways to ensure that the Executive has the information that they need.

If you have any questions about compliance reporting or this article, please contact us below or send us your enquiry here.

Author: Nathan Cecil

  • This article was originally published in CoR Adviser. The article is © 2022 Portner Press Publishing Pty Ltd and has been reproduced with permission of Portner Press.

The information in this article is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, we do not guarantee that the information in this article is accurate at the date it is received or that it will continue to be accurate in the future.

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