Baxter International Inc.

Implementing a Global Safety Management System – OHSAS 18001

Sharon Kemerer, MSN, COHN-S/CM, FAAOHN Corporate Director, Occupational Health & Safety June 2013

Global Healthcare Company

• Approximately 51,000 employees in more than 60 countries

• Manufacturing facilities in 27 countries

• Products sold in more than 100 countries

• More than half of sales and earnings come from outside the United States

Baxter is an international company with a strong global brand and broad geographic reach:

“Saving and Sustaining Lives Worldwide” 2

Baxter International Inc.

Baxter is a global, diversified healthcare company applying innovative science to develop specialty therapeutics and medical products that save and sustain patients’ lives. Every day, our products and services help treat thousands of people around the world with some of the most complex medical conditions — like hemophilia, immune disorders and end-stage kidney disease.

Baxter’s Published Company Vision

• Recognized and trusted worldwide

• A preferred partner in improving the quality of and access to healthcare

• An innovator in science and technology

• Committed to quality and excellence*

• Focused on sustained financial strength

• A rewarding place to work and develop*

• A socially responsible member of our communities*

At Baxter, we aspire to build a truly great company by being:

* These values support our EHS efforts and our management system approach.

Commitment to Sustainability

Responsible Corporate Citizenship At Baxter, sustainability means creating lasting social, environmental and economic value by addressing the needs of the company’s wide-ranging stakeholder base, comprised of:

• Our People • Our Operations and Products • Our World

Baxter’s nine sustainability priorities lead the company’s efforts in areas such as carbon

emissions, natural resource use, inclusion and diversity, ethics and compliance, product stewardship, access to healthcare and education.

Baxter has been recognized by or affiliated with many sustainability-related organizations and programs including:

Newsweek 2012 Green Rankings Logo, ©2012 Newsweek/The Daily Beast Company LLC. Used by permission and protected by the Copyright Laws of the United States. For more information, visit www.newsweek.com/green.

Safety is a Sustainability Priority

Primarily Clean Work Environments

History of OHSAS 18001

BS 8800 (1996) – Consensus standard. Not auditable. ISO effort OHSAS = Occupational Health and Safety Assessment Series OHSAS 18001 … developed to be compatible with ISO 9001

(1994) and ISO 14001(1996) Published “in response to urgent customer demand for a

recognizable occupational health and safety management system standard” by BSI o A health and safety management system that can be

assessed and certified. • 18001 = Specification document • 18002 = Guidance for the

specification

Major OHSAS 18001 Sections

General Requirements

OH&S Policy

Planning • Hazard Identification • Risk Assessment • Risk Control • Legal & Other Requirements • Objectives & Targets

Implementation & Operation • Structure & Resp. • Training, Awareness,

Competence • Communication • OH&SMS Documentation • Document Control • Operational Control • Emergency Prep. &

Response

Major OHSAS 18001 Sections (cont.)

Checking & Corrective Action • Monitoring & Measurement • Nonconformance & Corrective

& Preventative Action • Records • OH&S Mgt. System Audit

Management Review

Leading to Continual Improvement

Plan

Do Check

ASPECTS

RISK SOURCES Identification of Hazards

ASPECTS – Identification &

Evaluation

RISK ASSESSMENT

ASPECTS – Prioritization

RISK - QUANTIFICATION

OBJECTIVES & TARGETS

SETTING OF GOALS

ASPECTS MANAGEMENT MANAGEMENT OF RISK

ASPECTS REVIEW

RISK REVIEW

ISO 14001

OHSAS 18001

ELEMENTS OF A SUCCESSFUL EHS MANAGEMENT PROGRAM

Risk Sources Risk Assessment

Risk Quantification Setting of Goals

Management of Risk Risk Review

Health and Safety (OHSAS 18001)

Environment (ISO 14001)

Aspects Aspects Identification Aspects Prioritization Objectives and Targets Aspect Management Aspect Review

Certification process

First Stage Assessment

Preassessment

Second Stage Assessment

Further Assessment

Close-out / Certification

Ongoing Surveillance and Recertification

Report on Weaknesses Recommendation for Certification*

Recommendations: • Certify

(subject to corrective action) • Further assessment

(limited areas) • Further assessment

(whole operations) • Deferral

Report on Weaknesses Recommendation for Certification*

Report on Weaknesses

Report on Weaknesses

13

Focus on Behaviours and Outcomes Not on Documentation and Bureaucracy

Management Behaviours/Techniques

Operator Behaviours

Bot

tom

Up

Anal

ysis

Top D

own Analysis

Courtesy of ERM CVS 14

How We Conduct Audits

Certification Timeline For Baxter

Preparation to certify to ISO 14001 in 1996 First facility certified to ISO 14001 in June 1997 Began the process of group certificates and finally a Global

Certificate to ISO 14001 in 2004 Began certification to OHSAS in 2003 with 2 facilities Created a Global Group Certificate for OHSAS 18001 in 2007 Use ERM/CVS as external certifier – accredited by UKAS As of 12/31/12, Baxter has

o 68 facilities in the ISO Group Certificate o 57 facilities in the OHSAS Group Certificate

2011 – 23 certification assessments 2012 – 23 certification assessments 2013 – 23 certification assessments scheduled

What is a Global Certificate?

Indicates confidence by the certifying body in our internal systems and ability to manage health and safety across the enterprise

Drives consistency and uniformity regardless of geographic or business boundaries (with common sense)

In addition to facility assessments, the corporate group is audited on an annual basis for the effectiveness of systems, communication and results. Management of issues evaluated.

Enables Baxter to recertify facilities on a flexible schedule: o 6 months or less with questionable performance o 1 – 2 years for facilities with system weaknesses o 3 years for high-performing sites

What can jeopardize the Group Certificate? o Significantly degraded performance at a certified site o Serious system gaps at the Corporate level

Thoughts on OHSAS 18001

Implementation − If ISO 14001 is in place, much easier – opportunities to piggy back − Management systems are parallel − Audits can be combined for efficiency − Performance/outcomes are considered in decision making on certification − Management review can be combined with ISO 14001 Training − Sites should have read the standard – not difficult − Root cause analysis should be robust − Periodic refreshers recommended

Other Benefits − Meets customer expectations − “Points” for social responsibility when completing sustainability surveys − Drives program outcomes and consistency

Choosing a Certifying Body

− Look for accreditation status of the group – UKAS − Red Flag – if they do ISO 14001/OHSAS 18001 and ISO 9001 at the same

time. The quality standard assessment is based on different sources of information • Might be OK for a periodic • Not OK for initial

− Ask about the process they use on site -- # days; # assessors − Partnering – will they do it?

• Combine with corporate audit = efficiency and less impact on site • Noncompliance with company requirements is considered • Can agree on consideration of performance

− Quality and experience of assessors • Consider technical backgrounds • How are they qualified to be a lead assessor

− Other Client Companies – history and references

Impact – Big Picture

Before OHSAS

After OHSAS

Impact on Safety Performance – 2005-2010 Long Range Goals and Current Performance

Reduction in Rates Since 2005 • 49% Cases with Days Lost Rate

• 39% Days Lost Rate

• 41% Recordable Rate

Cases with Days Lost Rate

Days Lost Rate

Recordable Cases Rate

Performance to Original 2010 Long-Term Goals

• 28% Favorable in Cases with Days Lost Rate

• 24% Favorable in Days Lost Rate

• 21% Favorable in Recordable Rate

Original Long Term 2010 Goal: 0.23

Original Long Term 2010 Goal: 6.00

Original Long Term 2010 Goal: 1.27

Current Performance – 12/31/12 • 0.154 Cases with Days Lost Rate • 4.33 Days Lost Rate • 0.90 Recordable Cases Rate

Comments or Questions?