Environmental Law for Business Seminar: Disaster Management


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The probability of an environmental disaster is low, but current events in Canada have demonstrated how the consequences may be catastrophic. How a company manages the event and its aftermath may determine the fate of the company, its parent and affiliates, and the risk exposure of its officers and directors.

What is the corporation’s legal obligation in the event of an environmental disaster?
What are the legal obligations of the corporation’s officers and directors?
How does one asses, prioritize, and implement health, safety and environmental remediation requirements?
How to deal with the regulators, investigators and the media?
Can you count on your insurance to fund your disaster response?
How can the company protect its brand in the aftermath?

Mark Madras, Partner, Gowlings (Toronto Office)
Sherry Eaton, Golder Associates Ltd.
Carl Spensieri, XL Insurance
Don Huff, Environmental Communications

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Environmental Law for Business Seminar: Disaster Management

  1. 1. Environmental Law for Business: Disaster Management Toronto, April 24, 2014
  2. 2. 2 With You Today Mark Madras Gowlings Sherry Eaton Golder Associates Don Huff Environmental Communication Options John Sarkis XL Insurance
  3. 3. Disaster Management – The Legal Perspective Mark L. Madras Certified Specialist (Environmental Law) Toronto, April 24, 2014
  4. 4. 4 What to Do When it Happens • Look to your plan • Duty to act • Duty to notify • Record and report • Incident management • Closure
  5. 5. 5 Requirement to Have a Plan • A matter of due diligence • May be prescribed (examples: CEPA, TDGR, Canada Shipping Act) • Assess the risks • Know the legal obligations • Response scenarios • Personnel, contractors and equipment • Train • Test • Update • Funding
  6. 6. 6 Notifications • Prescribed duty to notify: - to what agencies - at what contact numbers - thresholds - by whom - what content • Civil law duty to notify (duty to warn) - assess who is at risk - triggers, recommended action, messenger and message • Internal notifications • Notice to insurer
  7. 7. 7 Incident Management • Person in charge • Managing the contractors • Who is engaged • Mandate • Terms and conditions • Oversight • Payment • Dispute resolution • Liaison with regulators • Liaison with insurers • Liaison with media • Liaison with supply chain
  8. 8. 8 Record and Report • Protecting the organization • May be prescribed during the event • May be prescribed post-incident • Evidence of diligence • Evidence of compliance • Evidence of expenditures for insurance • Evidence of expenditures for contractual purposes • Who to maintain the record • What to be recorded • How to be recorded (log, video, memoranda)
  9. 9. 9 Closure • Indentify post-incident issues to be managed • Claims • Prosecution • Orders • Insurance • Report requirements: internal, regulators • Media • Supply chain • Emergency response plan update • Root cause and response assessment
  10. 10. 10 Incident and Response Investigation • Determining the root cause • Assessing the sufficiency and compliance of the response • Operational assessment vs legal: Is it privileged and confidential?
  11. 11. 11 Risks if it Goes Wrong • Prosecution for non-compliance: for incident, for response • Orders: for compliance, environmental restoration or risk management • Potentially responsible parties: the operating company, persons, officers and directors, controlling corporations • Reputational
  12. 12. 12 Conclusions • Know the risks of the enterprise • Assess the risks to the enterprise • Plan the response • Protect the business and its stakeholders
  13. 13. montréal • ottawa • toronto • hamilton • waterloo region • calgary • vancouver • moscow • london Thank You Mark L. Madras Certified Specialist (Environmental Law) Tel: (416) 862-4296 Email: mark.madras@gowlings.com
  14. 14. Environmental Disaster Management: Response and Remediation Presented by: Sherry Eaton, M.Sc., P.Geo., PMP Golder Associates Ltd.
  15. 15. Could it Happen to Me?  Mississauga train derailment (1979)  Hagersville tire fire (1990)  Plastimet fire, Hamilton (1997)  Sunrise Propane explosion, Downsview (2008)  Lac-Mégantic train derailment, Quebec (2013)  Others •15
  16. 16. Prevention, Planning and Preparedness  Identify risks  Use of best management practices  Training (prevention and response)  Infrastructure and equipment maintenance  Prevention and contingency planning  Response exercises •16
  17. 17. Having the Right Team  Internal  Contractors  Consultants  Insurers  Government  Public •17
  18. 18. Know Your “Site” Location on-site/off-site accessibility Receptors site workers, tenants public, neighbours environment Pathways infrastructure, drainage, site plans •18
  19. 19. Know Your Products/Chemicals  Chemical characteristics • solubility • volatility • flammability • toxicity  Behavior and migration in the environment •19
  20. 20. Initial Response  Rapid assessment of the situation • Who is at risk? • What chemicals are involved? • What are the potential migration pathways? • What is the magnitude of the current and potential impacts?  Activate plan and notification requirements •20
  21. 21. Initial Response  Determine: • what immediate action is required (contain and recover) • what support and equipment are required • who is in charge (incident commander) • what are the impact on site operations  Mobilize resources  Address H&S and site security •21
  22. 22. Delegation of Responsibilities  Incident Commander (overall responsibility/decision maker)  Operations Manager (implementation)  Logistics (provision of resources)  H&S Officer  Finance (cost tracking)  Administrative  Internal and external communications •22
  23. 23. During the Response Contain and Control:  control and remove source  prevent further migration  initiate recovery, treatment and removal of impacted media  environmental monitoring •23
  24. 24. Remediation and Cleanup  Determine: • cleanup objectives • degree and extent of impact • remedial approach  Develop plans and schedules  Consult with regulators and stakeholders  Consider options, alternatives and costs •24
  25. 25. Key Learnings  Prevention is cheaper than response  Emergency response and remediation are extremely costly  Communication is critical  Emergency response is stressful  Learn from the experience •25
  26. 26. Questions & Discussion Contact Info: Sherry Eaton, M.Sc., P.Geo., PMP Associate Golder Associates Ltd. 100 Scotia Court, Whitby, Ontario Tel: 905-723-2727 E-mail: seaton@golder.com Website: www.golder.com
  27. 27. © 2013, XL Group plc companies. All rights reserved. Environmental Insurance and Disaster Management John Sarkis, P. Eng. Senior Environmental Underwriter, XL Insurance Company Ltd . MAKE YOUR WORLD GO •27
  28. 28. © 2013, XL Group plc companies. All rights reserved. Environmental Coverage Summary •28 Fixed-Site Coverage Contractor’s Coverage • Location specific coverage • Responds to Pollution Events both on and off-site • Remediation Expense (1st and 3rd party) • 3rd Party Bodily Injury and Property Damage •Creation or worsening of Pollution Events during contracting activities •Remediation Expense •3rd Party Bodily Injury and Property Damage
  29. 29. © 2013, XL Group plc companies. All rights reserved. Terminology •29 Disaster Response Expense / Crisis Management Expense / Public Relations Expense - Terms are interchangeable and vary by Insurance Carrier - Cost associated with maintaining/restoring a company’s public image related to pollution event Public Relations Expert/Disaster Response Advisor - Terms are interchangeable and vary by Insurance Carrier - Firm or person(s) charged with restoring a company’s public image
  30. 30. © 2013, XL Group plc companies. All rights reserved. Covered Expenses •30 •Securing of a Scene/Area •Medical/Funeral •Counseling •Travel •Temporary Living •Printing and Mailing •Call Centre Support
  31. 31. © 2013, XL Group plc companies. All rights reserved. How is Coverage Triggered? •31 • Pollution event requiring Remediation Expense (clean-up), or that causes Bodily Injury or Property Damage; • Draws Media attention; and • Requires a Public Relations Expert (or similar advisor). Triggers above vary (more or less) by Insurance Carrier
  32. 32. © 2013, XL Group plc companies. All rights reserved. How is a Claim Filed? •32 • Emergency Response Phone Numbers and 24/7 availability from your Insurance Carrier • Disaster Response Coverage is subject to the Reporting Conditions of the Policy • It is in the company’s best interest to involve their Insurance Carrier as soon as possible • It is in the company’s best interest to provide Insurance contact information in all emergency response plans particularly at the facility level (and Health and Safety Plans)
  33. 33. © 2013, XL Group plc companies. All rights reserved. Information and Cost •33 • Insurance Carrier will need to understand a Company’s Emergency Response Procedures • Insurance Carrier may also ask for record of public complaints • Various Insurance Products with Disaster Response Coverage built-in, others need to be added to coverage • Limits of Coverage may or may not erode the aggregate Limits of Liability
  34. 34. © 2013, XL Group plc companies. All rights reserved. Questions? •34
  35. 35. Crisis Communications Don Huff President Environmental Communication Options April 24, 2014
  36. 36. • cri·sis noun krī-s sˈ ə Crisis communications
  37. 37. 1. Preparation 2. Response 3. Moving forward Three stages
  38. 38. Resist the urge
  39. 39. • Having an effective crisis communication plan puts you “more” in control and provides the skills and confidence to face what may be a very volatile and confusing situation. Preparation: the rationale
  40. 40. • Be a Boy Scout: be prepared • Create a crisis communications response team • Develop a plan Being prepared: the calm before the storm
  41. 41. • Convene an internal brainstorming session • Identify audiences (internal and external) • Finalize plan and get organized – Ensure plan is understood in place for immediate action (contact lists, documents, etc.) Preparation: necessary steps
  42. 42. • Media monitoring – Continuously monitor your “reputation” – be alert to traditional and social media – Identify issues; know reporters; listen: catch things early • Media training – For spokespeople • Build skills prior to crisis • Training will occur again during crisis – Be ready for difficult questions Preparation: necessary steps
  43. 43. • Don’t panic – Gather facts – Assess the situation – Stick to the plan The response
  44. 44. • Don't jump the gun and create a crisis where one doesn’t exist Not everything will “stick” • BUT: hiding something is often punished painfully by the media
  45. 45. • Decide immediately whether to be proactive or reactive – Choosing no action is still a choice • Decide what level of your organization needs to respond • Ensure that internal and external communications are controlled and consistent with your plan How do we respond?
  46. 46. • Media conference / Media availability • Media release • Personal phone calls (media and influencers) • Briefing for reporters (daily/hourly) • Social media Response options include:
  47. 47. • Give the media as much information as possible – they'll get the information (perhaps inaccurately) from other sources • Honour your own deadlines • Consistent messaging from all spokespeople • The media is not your friend, but they are not the enemy Dealing with media
  48. 48. • Consider the medium – Dictates amount of information and speed required • Print need more info than radio/TV; • Speed of response is becoming more important with emergence of online news—especially social media • Keep a media log with names, numbers and promises related to deadlines or interview times • Don’t poke the bear. Nothing is more likely to make the situation worse than an irritated reporter with no information, a deadline and an impatient editor. Dealing with media
  49. 49. • Don’t forget your employees – Consistent messaging – Keeping employees motivated and onside – Employees can be brand champions • Sharing information with members of the organization reduces the chances of inconsistent or contradictory information – Provide information to people in your organization before the media (or at least coincident) Internal communications
  50. 50. • Spokesperson should be forthright in dealing with media questions • BUT: there are exceptions—especially in the early stages of a crisis—when some information is preliminary and likely to change For instance: – The cost or value of damage – Status of insurance coverage – Allocation of blame • Avoid anything “off the record” Exercise honesty…with caution
  51. 51. • “No comment” translates into you looking evasive, uncooperative and trying to hide something all rolled into one • More appropriate responses include: – “I have just learned about the situation and I am trying to gather the information.” – “All our efforts are directed at bringing the situation under control, so I'm not going to speculate on the cause of the incident.” – “We're preparing a statement on that now. Can I call or email it to you ASAP?” “No comment” says plenty
  52. 52. • The situation is always evolving – Information, news and perspective can and will change throughout the response period • Consider (carefully) what is written—even in your internal emails – Ask yourself: would you like to see these words beside your picture on the front page of the Globe or the Star? Remember
  53. 53. It will end
  54. 54. • Declare an end to the crisis. • Follow up. Keep the media informed of any updates in the situation. • Perform an act of goodwill. Do this during or immediately after a crisis when appropriate and possible. Prepare to be judged (apply common sense). • Learn from the pain. Debrief and analyze the outcome and the media coverage, both positive and negative. • Strengthen your crisis communication plan by integrating what you’ve learned. Moving forward
  55. 55. Getting through a crisis: 1. Be prepared 2. Proper team and plan – Properly trained; understand roles 1. Take a deep breath – Don’t be stampeded as you enter the fray 1. Respect and cooperate with media 2. Follow through 3. Internalize lessons learned You can do it
  56. 56. Help is at the end of the phone
  57. 57. Don Huff huffd@ecostrategy.ca 416-972-7401 ecostrategy.ca Thank you Toronto Address 19 Yorkville Avenue Toronto, Ontario M4W 1L1 Sudbury Address 31 Larch Street, 3rd Floor Sudbury, Ontario P3E 1B7
  58. 58. montréal • ottawa • toronto • hamilton • waterloo region • calgary • vancouver • moscow • london Thank You