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Canadians stress a cleaner environment.

Environmental issues were at the top of the agenda during last month's RIMS Canadian Risk Management Conference in Montreal. With 770 participants, the largest risk management gathering ever in Canada, the conference opened with a welcome from chairwoman Sophie Zubyk, risk and insurance manager of Clark Transport in Montreal, and an address by RIMS President Cheri Hawkins. The four-day event rapidly moved on to the keynote address b Clifford Lincoln formerly an insurance broker who served as Quebec's minister of the environment.

"We the creators, innovators and producers are more and more destroying the natural resources that help us to live," exclaimed Mr. Lincoln in a very moving speech that was concluded by a wave of applause. "I wonder how a world so productive, so creative ... cannot be creative, inventive and suspicious enough not to know the consequence of its actions."

Mr. Lincoln, recounting news reports of 21,000 barrels of industrial toxic waste aboard an Italian ship and residential garbage from Islip, NY, on a barge that several nations refused to allow to be dumped on their shores, said the world produces without thinking of how to dispose of its waste products. In 1985, he said, the world produced 250 million tons of chemicals, an amount that is expected to double every seven to eight years. Plastics, which are used in countless products, can last 450 to 2,500 years before decomposing, he said. Because we need these chemicals and plastics to produce a variety of vital components and end products, industry must begin to think about how to dispose of the wastes they generate, he added.

"I sincerely believe that you in the insurance industry [and specifically risk managers] have a large part to play," said Mr. Lincoln. Risk managers are in key positions to influence how companies dispose of hazardous wastes, as well as to encourage the production of environmentally safe products, he explained.

After discussing recent U.S. court rulings that have held banks liable for cleaning up the toxic wastes left behind by their bankrupt borrowers, Mr. Lincoln said that the environmental status of a company .. is going to be a key factor in the future." During a merger or acquisition, for example, "The first question will no longer be What is the balance sheet like?' but What is the environmental record like? ... Is the land on which it sits safe?"' he said. "People have become so conscious of the environment that the upheaval it has caused makes potential liability suits a real impact."

The only way that companies and nations will be able to prosper in the future is to employ clean technologies, according to Mr. Lincoln. "Clean technologies are going to be the greatest environmental tool in the future for countries which seize them," he said, suggesting that manufacturers use production processes that are so clean they do not require anti-pollution devices such as scrubbers.

"The environment is the quality of life.... The minute we have polluted ourselves ... then what is quality of life worth?" he concluded.

Shipping Dangerous Goods

Several other conference events touched on issues related to the environment, including assessing environmental exposures, the Transportation of Dangerous Goods Act and workplace hazardous materials information systems.

The Transportation of Dangerous Goods Act, which was enacted in 1980 and was followed by a set of corresponding regulations in 1985, establishes safety requirements for Canadian manufacturers, shippers, distributors and agents who package, handle and transport explosives, flammable gases, liquids and solids, poisons, corrosives and radioactives. The regulations contain rules on classifying, documenting and disclosing dangerous goods, training those who handle them and notifying the appropriate agencies when they are accidentally released into the environment.

"One major point of interest," according to Michael Abcarius, director of corporate loss control for Domtar Inc. in Montreal, "is that this is the first Canadian law that stipulated that any person contravening or authorizing contravention of the act is directly liable to a fine of up to CAN$50,000 for the first offense and a fine of up to CAN$100,000 and/or two years' incarceration for any subsequent offense." If a company pays an employee's fine, that amount is considered part of the employee's taxable income, he added.

To date, Mr. Abcarius said, most fines have been in the CAN$4,000 to CAN$5,000 range. "It's not the money, but the affect on insurance rates," that sting, he said. "If you've done everything reasonable to comply with the law, no one is going to come after you."

John Hosty, president of the Canadian Environmental Response and Training Association in Burlington, Ontario, took risk managers through a display of safety marks which correspond to an elaborate classification system and are placed on freight and vehicles to disclose the existence of dangerous goods.

"The procedures for classifying dangerous goods are very involved and even laboratories are having difficulty," said Mr. Abcarius. "But you are liable even if the laboratory screws up.

Companies handling and transporting such goods also need to be aware that they must file an emergency response plan with the Transportation of Dangerous Goods Directorate, said Mr. Abcarius. In the plan companies must provide a 24-hour contact for damaged packages and associated releases. The contact can be an employee or organization such as CANUTEC, a Canadian government agency, a petroleum or chemical industry association or a contractor who is knowledgeable about the cleanup procedures. "Contractors, however, don't assume liability and are expensive," warned Mr. Hosty.

Workplace Handling

A later session focused on the exposure of employees to chemicals in the work environment. As in the United States, where the Occupational Safety and Health Act has led to protecting workers who are exposed to chemicals on the job, in Canada, the Hazardous Products Act has done the same. Since October 1988 Canadian companies have been required to establish workplace hazardous materials information systems (WHMIS), which include using specific labels and warnings for chemicals, distributing material safety data sheets and training employees. "The key to WHMIS is communications-people working with chemicals have the information to work with them safely," said Paul Gray, manager of risk, safety and regulatory affairs for Nordion International in Canata, Ontario. Failure to comply, according to joseph Doucette, manager of health and safety for IVACO Inc. in Montreal, can cause a plant to be closed for days or weeks at a time and may subject a company to steep fines.

Although the purposes of the U.S. and Canadian laws are similar, there are significant differences in the regulations. WHMIS mandates specific standards, while the U.S. Occupational Safety and Health Administration only sets performance standards, explained Luc Hamelin, IVACO's industrial hygiene coordinator. The systems for classifying chemicals also differ, as do the ways to inventory chemicals and employ a hazard communications system, he said. OSHA requires that a chemical inventory and hazard communications program be spelled out in writing, while WHMIS, except in certain provinces, does not require an inventory and only implies that the program be documented. However, Mr. Hamelin said, "It is wise to have a written program plan."

The design of and information on supplier package labels also differ in terms of languages, classification symbols (safety marks), supplier information and first aid measures, among other things, he said. Symbols, for example, are mandatory in Canada, while they are not required in the United States, where there is little agreement on their design. In addition, there are different training requirements, he said.

The interest in environmental issues, both indoors and outdoors, was also evident during the opening session. Following Mr. Lincoln's keynote address, attorneys from the law firm Lavery, O'Brien of Montreal staged a mock trial over the refusal of a cemetery to bury a corpse due to toxic waste disposal regulations associated with the Environmental Quality Act of Quebec. Members of the audience roared with laughter, almost as much as during an evening performance by Andr6-Philippe Gagnon, a popular Canadian comedian/impersonator.

Global Matters

The conference also highlighted global issues, particularly Europe 1992. During a general session, an international affairs lawyer, a broker and insurer updated participants on changes in the EEC that will allow freer trade across borders.

"The combination of a single European market with opportunities in Eastern Europe raises crucial strategic issues for all Canadian and United States companies," said Thomas Kaiser, senior vice president of Arkwright Mutual Insurance Co. in Waltham, MA. "We have to start thinking globally not only to be successful but to survive," added Francois Bourassa, international affairs lawyer for the National Bank of Canada in Montreal. "The ever-changing global markets mean more commercial and political risks for Canadian corporations." To combat these risks, risk managers must be well-educated. They must understand not only insurance and loss control but also law, economics, accounting, engineering, history and sociology, said Mr. Bourassa.

In terms of insurance in the EEC, lower premiums are anticipated due to increased insurance competition, said Philip Brown, executive vice president of Marsh & McLennan in London. Denis Glaude, director of risk, insurance and real estate for Dominion Textile Inc. in Montreal, the session moderator, predicted that premiums would drop by as much as 60 percent. Mr. Brown also predicted that eventually a truly European policy would be created.

A popular session also highlighted global insurance programs. Kathy Chan, director of finance and risk management for Bell Canada International Inc. in Ottawa, and Jim Johnstone, manager of corporate risk/insurance for Northern Telecom Ltd. in Mississauga, Ontario, discussed two approaches to a global program. Bell Canada purchases insurance on a local basis to meet limited-term contractual obligations, while Northern Telecom procures most coverages on a global basis, but its overseas operations obtain those required by local laws.

Et Cetera

Other conference highlights included a general session on negotiating skills, an array of exhibits and the presentation of awards. Marc Darby, director of risk management for Bombardier Inc. in Montreal and former RIMS president, and J.A. Tony Bridger, risk manager for the Bank of Montreal in Toronto and RIMS vice president-business and industry liaison, received the Don Stuart Award, which recognizes their extraordinary contributions to the field of risk management. The award is named in honor of Mr. Bridger's one-time boss at Toronto-based Canada Packers Inc., where both men served as risk and insurance manager. Denis Bergeron, Bombardier's manager of risk and insurance, received the Canadian Education Award for achieving the highest grade point average this year on the exams leading to the CRM designation.

Next year the Canadians will head to Edmonton, Alberta, to stage a "Risk Management Renaissance" Sept. 22-25. The organizers hope to top this year's program and attendance, but doing the latter will be difficult. Of the 770 participants this year, 447 were delegates and the remainder included exhibitors, speakers, guests and others. Almost 250 of those present were bona fide risk managers.
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Title Annotation:RIMS Canadian Risk Management Conference
Author:Schussel, Mark L.
Publication:Risk Management
Date:Nov 1, 1990
Previous Article:Merging information systems for risk and benefits managers.
Next Article:A taxing problem for insurers and policyholders.

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