Construction safety a top concern for China to address: Parima conference

Basic safety measures are lacking on many Chinese construction sites despite the rising public anger over the Tianjin explosion of 2015, where the full extent of damage has yet to be quantified. With the One Belt One Road initiative likely to signal a boom in construction, there is an urgent need for enhanced safety standards and it has become a subject of critical interest to risk managers, insurers and risk engineers alike. So it was no surprise to see it feature so prominently at the recent Pan-Asia Risk and Insurance Management Association conference in Shanghai. One of the changes introduced in China as a result of the Tianjin disaster is a higher liability for senior executives and the threat of prison time should another event with fatalities occur. Yet despite this threat, many construction sites fail to adhere to fundamental safety measures. A survey of construction sites in China plus interviews with various construction workers and safety managers, conducted by Kevin Yang, executive director, JLT Risk Consulting, exposed a series of fundamental failings. The top risk on any construction site is fire and the survey showed an absence of personal protective equipment, firehoses with no water and examples of fire inspectors smoking cigarettes while they toured construction sites. Other failings included poorly constructed scaffolding, no use of safety harnesses, or else not fastening it correctly in case it stops workers moving freely, no use of helmets, throwing objects from heights of 30m or above and no designated area for industrial lifting, and a litany of other contraventions. “Stop your construction projects until these are fixed,” Mr Yang told the risk managers. “An incident could see your senior executives in prison and the loss of the company’s reputation.” Contractor selection is the most critical part because they set the safety culture for the rest of the project, said Ben Hazelton, head of risk engineering Asia, Generali. “The safety measures seem like common sense but a lot of contractors are not implementing them.” It is critical to avoid selecting on price alone; however, unlike price, safety can be a difficult thing to evaluate, conceded Hazelton. “You have to do a lot of research and the insurer can be a good place to start because we see the good, bad and the ugly.” And risk managers also have to look beyond whatever safety records or plans a contractor may have, said Nathan Lee, HDI Global, because events will inevitably get in the way. “Even the best planned projects can run over time and over budget and in the final stages, safety can often be the victim.” Various processes like pressure tests for pipelines may be foregone in order to save time and money as a project comes close to completion but by then it is a high value construction suite and a pipe failure could damage everything. “Even if you are running out of time, you have to stick to the safety plan,” said Mr Lee. Another problem for risk managers is the conflict between national and local safety standards, and where companies are keen to adopt the lower of the two. There are also international standards from the likes of risk consultant FM Global or the National Fire Protection Association. “It is always a risk which guides you decide to follow. And regulations can evolve over time so often nobody knows what rules apply. Ultimately you have to make a choice,” said Mr Lee. Authorities have got smarter though, according to Mr Hazelton, and have recognised the problem of being led by written guidelines rather than taking a more risk-based approach. “They are moving away from a formal framework and insisting that the building must be safe,” he said. A further difficulty for risk managers is that they may find that their role is already covered by others involved in construction projects – be that the project manager, the fire officer or the safety officer. For the insurers and risk consultants, this is all the more reason for their services to be engaged by risk managers. “Contractors have inspectors but they pay for them. You need a third eye that is independent to review the safety risks,” said Mr Yang. “And in the big projects there will be project managers but they will have their own agenda, so it is important to have some external parties come up with safety plans,” added Mr Lee. More punitive sanctions for senior executives will help raise safety standards as would the adoption of ‘zero harm’ rules and other best practice approaches such as are commonplace in the UK. However, it is not as though the UK is immune from a lapse in best practice as the Grenfell Tower fire so tragically showed. It also showed that safety issues can arise several years after construction, particularly during a building-wide refurbishment as was the case in London And then there are other countries or cities such as Alexandria in Egypt where a system rife with poor governance and corruption has created the Leaning Tower of Alexandria – a 13-storey building that fell and crashed against a row of apartments on the other side of road, and remains propped up some four weeks later. But for insurers in the construction market, there is a degree of acceptance that there will seldom be a perfect and risk-free constriction site and if an insurer wants to create any kind of meaningful presence in the construction sector, they will have to reluctantly accept that certain issues or lapses will arrive, particularly when there is so much capacity in the market at present. This underwriting dilemma also goes some way to explaining why insurers and brokers are currently so active in their efforts to become an external and independent safety resource for risk managers to rely on.

Construction safety a top concern for China to address: Parima conference

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