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Speech

April 9, 2015

Building a Culture of Safety

Darren W. Woods

Darren W. Woods Chairman and Chief Executive Officer

ISN Connect
Grapevine, TX

This event has been described as a “celebration of safety.” I am personally happy to participate and help recognize the success that many of our industries have achieved in this critical area.

I think it is also important at this event for each of us to think of ways to improve our safety performance and to take new ideas and new approaches back home to our own work sites.

In this effort, I am honored to speak on behalf of the men and women of ExxonMobil.

The invitation to address this group is really a tribute to them. It is a recognition of a very long journey – and very deep commitment – we have to a culture of safety.

I believe it is a passion that is embraced by every employee at ExxonMobil.

It is a passion that, we hope, will grow to be embraced by every employee and every company in the global energy industry.

Ultimately, for our industry to be successful, it has to be.

Energy is the indispensable industry. It fuels development and human progress around the world. Our industry touches the lives of billions of people every day. Access to reliable and abundant sources of energy is the foundation for our many areas of society’s advancement.

The modern world in which we live – a world of electricity, transport, trade, labor-saving inventions, and profoundly improved health – has been made possible by the widespread use of energy. And where there is no or little access to modern, reliable forms of energy, there is poverty, subsistence living, and undue hardship.

The immense scale of the global energy industry is hard for many to comprehend.

The entire world consumes more than 92 million barrels a day of oil and liquid fuels. That works out to more than 1,000 barrels per second, each one produced at no small effort by companies like ExxonMobil, Pioneer, and many of the other firms represented here today.

But these statistics pale when put in the context of the story of even one of the projects that supply the world with energy.

For instance, on the east coast of Canada, we are progressing a project called Hebron. Hebron will take five years to build. It will cost more than $14 billion. It is scheduled to start up in 2017, and over the course of its 30-year lifetime, it will likely produce about 700 million barrels of oil. People who haven’t even been hired yet will spend most of their entire careers working on this project.

And yet, Hebron’s entire production will be enough to supply current global demand for just eight days. 

That is just one project. To meet the enormous and growing demands of advancing nations, our industry has pioneered technologies and techniques that are often compared to putting an astronaut on the moon.

Consider ultra-deepwater production, which started in the Gulf of Mexico. Ultra-deepwater entails drilling from a platform offshore in water as deep as two miles. From there, wells are drilled to pinpoint accuracy another five miles below the ocean floor.

I know quite a few engineers who make a compelling case that this is far more difficult than sending people to the moon – admittedly, they work in our industry – and, yet, our industry does it every day.

America's energy resources – particularly our oil and natural gas – are prime drivers of our nation’s economy and our standard of living. It is essential that we ensure the safe and responsible production of all these resources.

This morning, I’d like to share the foundation of ExxonMobil's approach to running our business: safety, operational integrity, and risk management.

A Culture, Not a Priority

We often hear it said that companies must make safety a “top priority.” We believe that a commitment to safety must run much deeper than simply being a “priority.”

A company's priorities evolve over time depending on business conditions and other factors.

A commitment to safety therefore, must be more than a priority, it must be a value – a core value that shapes decision-making all the time, at every level.

Every company desires safe operations – but the great and abiding challenge is to translate this desire into action.

The answer is not found only in written rules, standards, and procedures. While these are important and necessary, they alone are not enough.

The answer is ultimately found in a company's culture – the unwritten standards and norms that shape mindsets, attitudes, and behaviors.

Companies must develop a culture in which the value of safety is embedded in every level of the workforce. It must be reinforced at every turn. And it must be upheld above all other considerations.

This is something that we spend a lot of time working at ExxonMobil.

Operations Integrity Management System

The most important event in the evolution of our company’s safety culture dates back to the 1989 and the Valdez spill. Valdez was a low point.

It was a traumatic event, with enormous consequences for all involved. But it also served as a catalyst and a turning point which prompted us to completely re-evaluate how ExxonMobil understands, approaches, and manages risk.

That is not to say that, prior to Valdez, we did not take safety seriously. ExxonMobil had been in business for more than 100 years, and we had always taken steps to maintain safe operations.

In fact, we were proud of our safety record. We believed, as our safety credo at the time stated, that all accidents and injuries are preventable. Like many companies, we worked to meet or exceed all industry safety standards. We trained our employees in safety procedures. And we tracked metrics that measured our success. But we did not have the comprehensive and systematic approach to managing this aspect of our business as we have today.

In the early 1990s, ExxonMobil undertook, what I consider to be, a visionary approach.

The goal was to wholly reorganize our work to make safety – of people, facilities, and the environment – an integral part of everything we do.

Safety would not only come first, it would pervade every step and stage of planning, development, and execution of our work.

It was the beginning of a long journey for our company. One that we are still on. We know that we cannot rest or waver from the objective of driving incidents to zero.

We are certainly not there. But we have made significant progress. As we have advanced in this journey, our experience continues to reinforce that improvements have to be driven from within the company.

Governments cannot impose a safety culture, and we cannot hire one. Regulators, experts, and consultants provide valuable services, but for an organization to change its culture, change must come from the inside-out, not the outside-in.

You cannot buy a safety culture off the shelf. You have to craft it yourself.

So we began. We began by creating a framework that puts our safety commitment into measurable action. Today, that framework is called the Operations Integrity Management System, or OIMS for short.

Because OIMS is multi-faceted, it can be hard to describe briefly. But here are the basics: OIMS is a rigorous 11-point set of elements designed to identify hazards and manage risk. Its framework covers all aspects of safety … management leadership and accountability … design, construction and maintenance of facilities … operating procedures … emergency preparedness … management of change … assessment of performance … and, of course, thorough inquiries into incidents.

OIMS guides the activities of each of ExxonMobil’s more than 75,000 employees, as well as our third-party contractors, all around the world. Over time, it has become embedded into our work processes at all levels.

Through OIMS, ExxonMobil monitors, benchmarks, and measures all aspects of our safety performance. Its structure and standards are shared and communicated the world over.

One of the greatest benefits of OIMS is that it has enabled ExxonMobil – a large organization that operates across diverse cultures and geographies – to be of one mind when it comes to safety and risk management. Thanks to OIMS, you can visit a refinery, a lab, an office building, or an offshore platform anywhere in the world and immediately be on the same page as the local workforce regarding safety practices and expectations.

Let me stress that the contractors we work with are part of OIMS.

We expect our contractors to be knowledgeable and aligned with our OIMS requirements. Not every company has this mindset, but we have found that when everyone in the workplace speaks the same language of safety – and works to the same standards – better results follow.

You may have heard the phrase: “If you can't measure it, you can't manage it.” We believe it’s true. That is why ExxonMobil measures and analyzes its safety performance – all the way down the line, to every business level.

We record not just our injuries, but our near misses. We know there are lessons in each of these.

We also learn OIMS required assessments. Importantly, these assessments at ExxonMobil are performed not only by trained safety personnel, but by cross-functional, cross-regional teams drawn from all over our global operations. In this way, all employees feel responsible for each other’s safety. It also helps employees take the safety knowledge they learn back to their home sites and back to their communities.

Leadership

Yet, OIMS by itself is only one part of the equation.

Even the best safety systems are not fully effective unless they exist as part of a broader culture of safety.

While ExxonMobil and other energy companies use a lot of equipment – everything from concrete and steel pipe to supercomputers and deepwater submersibles – it is people who apply and operate this technology. Their behavior determines safety performance.

By beginning to instill the value of safety in our employees from the first day of hire, ExxonMobil strives to create a working environment in which safe behaviors are internalized, reinforced, and rewarded.

The culture of safety starts with leadership. Leadership drives behavior. And behavior establishes culture.

Leaders influence culture by setting expectations, building structure, teaching others, and driving accountability.

That is why the first element of OIMS is “management leadership and accountability.” ExxonMobil managers are expected to lead the OIMS process. A significant part of their performance assessment is based on doing this successfully.

But management alone cannot drive an organization’s behavior. For a culture of safety to flourish, it must be engrained throughout the organization.

Therefore, safety leadership at ExxonMobil comes not just from supervisors and managers, but from employees and contractors, through both formal and informal channels.

ExxonMobil’s goal is not simply to have employees comply with safety procedures. A culture of compliance does not drive ownership or improvement.

Our aim is to go beyond compliance, to create a culture in which all of our workforce owns safety. And not only comply with safety procedures, but to challenge every person to improve them.

Achieving a Sustainable Culture of Safety

To get where we need to be on safety, continuous improvement is essential.

In an industry such as ours – which operates 24 hours a day, around the world — the need to manage risk never ends. Even the best safety framework should be viewed as a work in progress.

Developing a culture of safety is a journey.

For ExxonMobil, that journey was transformed nearly a quarter century ago, when we put our global safety framework in place.

Once that framework became embedded in our organization, we saw the culture start to change and our results improve.

Over the years, I have seen people at all levels come to understand that our safety systems are put in place for them. They see that it is all about protecting themselves, their coworkers, and their communities.

Until an organization reaches the point where everyone owns the system and believes in it, until it enters the hearts and minds of the people to become a very part of who they are as a company, that system and culture of safety is not sustainable.

We often use the phrase at ExxonMobil, “Nobody Gets Hurt” to describe our safety objective. Some observers of our company question this. They say it cannot be done. We disagree. It can be done. We have units operating today that have gone years without a recordable injury.

Upholding the highest standards

Let me draw to a close with one last key point: Upholding the highest standards of safety and operational integrity is not just “the right thing to do.” This phrase is sometimes associated with the act of selflessness. But managing safety is in a company's self-interest. It makes for a more disciplined organization and more productive employees and organizations.

The standards of rigor, discipline, and accountability required to improve safety performance are the same qualities that produce successful business results – operationally and fiscally.

On this journey we have also developed a mindset that safety is not proprietary. And for this reason, ExxonMobil shares its best practices.

We also seek to learn from others.

It is by constantly learning and analyzing – by looking to best practices in other organizations, and by examining incidents, and near-misses – that we continually improve our own performance.

There can be no endpoint to this safety journey. There will never be a time when we can rest. The reality is that the ongoing journey is what instills discipline and sharpens focus. It wards off complacency and keeps us striving to be our best.

Meeting the world’s growing demand for energy involves a high degree of risk. We operate some of the world's most complex technologies in some of the world’s harshest environments.

We know that only through vigilance, discipline, and humility can we find ways to effectively manage risk at every step in the global energy value chain.

Of course, no company – including ExxonMobil – can lay claim to a 100 percent success in this endeavor.

Yet that remains our objective. And every one of our employees knows it always will be.

Thank you for your time.

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