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2012 Green Cross for Safety Medal Winner

February 1, 2012

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Andrew Liveris
Chairman & CEO
The Dow Chemical Company
Midland, MI
 

Andrew Liveris is chairman and CEO of The Dow Chemical Company, a global leader in special chemicals, advanced materials, agrosciences and plastics, delivering solutions to sectors such as electronics, water, energy and infrastructure.

An advocate for the criticality of manufacturing, Liveris serves as co-chair of President Barack Obama’s Advanced Manufacturing Partnership, and is the author of “Make It in America,” which presents a comprehensive set of practical policy solutions and business strategies for reviving this important sector. In recognition of his efforts in this arena, Liveris has been honored with the 2011 Distinguished Performance Award for Excellence in Public Policy from the Committee for Economic Development and the 2011 International Leadership Award from the United States Council for International Business. He sits on the board of directors of IBM, and is vice chairman of the Business Council, vice chair of the Business Roundtable and a member of the President’s Export Council.

Liveris serves as president and chairman of the board of the International Council of Chemical Associations. He is also a trustee for the Herbert H. and Grace A. Dow Foundation, USCIB and Tufts University. A chemical engineering graduate, Liveris continues to support his alma mater as the inaugural chair of the University of Queensland in America Foundation.

What does safety leadership mean to you?

Andrew Liveris: Safety leadership is more than programs, initiatives or even strong performance. Safety leadership is a mindset – a way of life at Dow. We expect all employees, from top executives to the newest hires, to have an unwavering commitment to safety excellence. It is an integral part of accomplishing our daily tasks and activities – on and off the job.

Early in our history, Dow chose to create a culture predicated on caring for human health, the environment, our communities and the world – and making that a top priority in terms of time, attention and money. It is one reason why working at Dow is 16 times safer than working in a grocery store and 23 times safer than working in a hospital. Our company’s “Drive to Zero” safety initiative demonstrates Dow’s relentless pursuit to reach “zero” – zero injuries, zero incidents and zero excuses. Our leaders constantly emphasize: “Safety first, pounds second.” So, when tough decisions need to be made, our leaders know that the safety of our communities and our employees is of the utmost priority. No exceptions.

 

Our definition of safety leadership has evolved and expanded in recent years. Our 2015 sustainability goals represent our intent to not only continue improving our environmental, health and safety performance, but to step up with even more far-ranging, more integrated, more collaborative and more innovative goals. Our business strategy is guided with an eye toward solving mankind’s largest challenges, and we are exploring ways in which our chemistry and expertise can support a sustainable future for our world. This means continuing to deepen the way we work with suppliers, joint venture partners, customers, governments, and communities to understand and respond to shared challenges.

For example, in China, we implemented a two-year project with the Chinese Ministry of Environmental Protection and the United Nations Environment Program to help promote safer production and better emergency preparedness among chemical companies. By sharing our expertise and best practices, we can positively impact the sustainable development of China’s chemical industry and benefit society as a whole.

 

Why is safety a core value at your company?

At Dow, safety is embedded in our corporate vision and strategic commitment to sustainability. We simply could not live up to our corporate values of Respect for People, Protecting the Planet and Integrity without an unrelenting focus on safety. Safety is infused into our corporate strategy and integrated into all Dow businesses, functions and geographies. Every business is required to incorporate EHS into its goals and make safety the highest priority wherever we operate. We care deeply about how our operations and products affect our employees, contractors, communities and customers. We believe ensuring all of our employees and contractors go home every night the same as they arrived is simply the right thing to do. Each of our 344 locations around the world, in fact, operates according to a global set of EHS standards that often exceed local requirements.

All employees and contractors at Dow “own” safety and EHS. Our Drive to Zero initiative is an inclusive program with detailed execution in all phases of our operations. It provides tools that can be leveraged at all Dow facilities across the globe.

How do you view the relationship between safety and quality, production and profitability?

They are not only intertwined, they are inseparable. Employee health and well-being not only influence medical care and other expenditures, but also the productivity and overall competitiveness of Dow. I also believe a company that delivers more sustainable solutions to its customers while operating safely and securely has a competitive edge. For example, as a world leader in chemistry, Dow takes very seriously our responsibility for managing the products we manufacture. We are committed to ensuring our products are manufactured, stored, transported, used, disposed of and recycled in a manner that shows high regard for human health, safety and environmental stewardship. In doing this, Dow has an opportunity to further differentiate our company and increase public confidence in our products.

 

What is the biggest obstacle to safety in your workplace, and how do you work to overcome it?

Complacency is the biggest challenge we face in our workplace. When tasks are routinely executed day in and day out, it can be tempting to grow inattentive, take shortcuts and overlook details. We constantly work to keep safety top of mind and remain vigilant – every day and with every task. Employees and contractors complete ongoing safety training. We also help drive the issue of personal responsibility for safety through our iCommit program, which asks employees to think about what they could do to help Dow reach our zero-injury goal.

In addition, our vow to “Drive to Zero” – zero injuries, zero incidents, zero near misses, zero spills and zero waste – means we are constantly unsatisfied with our performance. We look to leading indicators such as near misses to find proactive measures to protect employees, the community and the environment. If a failure does occur, we acknowledge it, conduct a root-cause investigation, take corrective action, and leverage the learnings across our sites to prevent repeat incidents.

How do you instill a sense of safety in your employees on an ongoing basis?

We want our employees to see safety as a 24/7 commitment, whether they are on or off the job. To help employees embrace safer and healthier lifestyle choices, we support a number of safety-focused activities. Our leadership takes an active role in safety sessions and kicks off all meetings with a two-way “safety moment” discussion. Often, the focus is on off-the-job safety topics such as boating safety, fire prevention or emergency preparedness. In addition, our award-winning health and wellness programs coordinate with our safety efforts to help our employees and their families make behavior changes that reduce their health and injury risk, improve their well-being, and drive our results.

Leadership, from the board of directors down, plays a key role in ensuring our commitment to safety is visible and that we remain vigilant. For example, when our leaders discuss their business’s quarterly performance with employees, EHS performance is discussed with the same priority as financial results.

We also seek to foster an environment where employee involvement, continuous improvement and teamwork flourish. We encourage our managers to actively solicit ideas on problems and solutions from all people in the work group, empower people to make decisions and implement solutions, and push decision-making down to the lowest possible level.

How do you measure safety? What are the leading indicators that show you how safe you are, and where do you see room for improvement?

We measure our progress with traditional EHS metrics – injury and illness rates, loss of primary containments, motor vehicle incidents, etc. But safety is more than traditional metrics. It is about people, so we also measure safety by the number of employees working across Dow that return home to their families.

Our leading indicators range from leadership engagement and a healthy workplace index to work process implementation and root-cause investigation effectiveness. This broad spectrum allows us to critically evaluate where we are excelling and where the next unplanned event may occur. And we continually seek better indicators of safety performance so we can prevent future incidents. We know there is always room for improvement.

How does safety “pay” at your company?

Setting ambitious EHS efforts at Dow and letting our employees develop innovative ways to meet those goals have resulted in safer workplaces, new business opportunities and considerable financial rewards. In 1996, Dow set ambitious 2005 goals that committed to a 90 percent reduction in injuries and illnesses per 200,000 work hours, leaks, breaks and spills, process incidents, and more. As a result, we reduced personal safety and health incidents by 84 percent. Our injury and illness rate is well below the chemical industry average. We also reduced solid waste by 1.6 million pounds, or the equivalent of 415 football fields of waste 1 meter thick, reduced water use by 183 billion pounds and saved 900 trillion Btu of energy. Our efforts, while difficult to achieve, saved lives and improved our world, while saving the company more than $5 billion with a $1 billion investment.

Our current set of sustainability goals for 2015 sets the bar even higher and calls for an average 75 percent improvement in key indicators for EHS operating excellence from 2005. By setting aspirational 10-year goals with annual milestones, we have been able to break free from a focus on incremental improvement. Because our employees are not sure how they are going to reach these goals, they are more likely to innovate and seek non-traditional ways to improve performance. That is exciting and has paid off with some truly cutting-edge technology improvements at our sites.

Describe your journey to becoming a CEO who “gets it.”

A truly transformational experience for both Dow and myself has been the journey we have taken in terms of how we view sustainability. In the past two decades, we have gone from focusing on improving our EHS performance within our fence line to incorporating the values of sustainability and corporate responsibility into the heart of our business strategy. When we examined the business environment several years ago, we saw what we call “megatrends” emerging. These are game-changing global shifts that are redefining important market sectors of health and nutrition, energy, consumer behavior, and transportation and infrastructure. We came to see these new global challenges as opportunities for Dow – opportunities to drive economic growth and to be a driver for change.

Our 2015 sustainability goals reflect this thinking. Not only do our goals recommit Dow to making our plants and operations safer and more efficient, but they also challenge us to use our expertise to find new solutions to help meet global challenges. So today, we are developing alternative feedstocks for our facilities while also embarking on a huge effort to develop and promote new energy efficiency solutions for our customers. Everything from new forms of insulation to new solar shingles that are making solar power more affordable to homeowners. We are working to improve the safety of our employees and communities while also creating products that improve the safety of everyone. These products include highly reflective waterborne coatings technologies that make the world’s roadways and runways safer, and reverse osmosis filters that bring safer, more affordable drinking water to some of the least hospitable environments on earth.

Our transformation is allowing us to boldly go where no chemical company has before. We are focusing our efforts on strengthening our relationships within the communities where we operate, continuing to improve our product stewardship, innovating to solve some of the world’s most pressing problems, and minimizing our global footprint. As a result, our efforts are helping us to build our reputation and strengthen relationships with all our stakeholders while creating new business opportunities for Dow. That is what I call a win-win situation – that elusive intersection where people and the environment can both prosper.

What advice do you have for other CEOs who want to “get it”?

I would advise them to set bold goals – goals so aspirational that you do not know how you can possibly achieve them. Only then will you truly stretch yourself and your people. This is the path Dow has taken, first with our 2005 EHS goals. After achieving and exceeding many of those goals, we pushed ourselves even further with our 2015 sustainability goals. These goals may be difficult to attain, but they have driven innovation and performance throughout our company, and have taken us to where we are today.

I also would tell them to set the tone from the top. Leadership, from the board of directors down, plays a key role in cultural change. Safety must involve everyone. Make safety a core value rather than an initiative, infuse it into your corporate strategy, integrate it across your company, and continually measure progress. In addition, leaders should take every opportunity to talk about safety. They must show they personally care, they want others to care and it takes a team to succeed.

Finally, never be satisfied. The moment you become satisfied with performance, you become complacent. The constant drive to zero, to perfection, is the key to “getting it.”

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