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Compliance as an Opportunity

Last week I wrote about what makes compliance a dirty word in Oil and Gas, as well as the drivers behind its current urgency in the industry. As we dive deeper into compliance, what’s interesting is that everyone agrees on the goals behind compliance – protecting our safety, the environment, royalty owner interests etc. In fact, the real issue seems to be in the implementation.

While implementing a compliance plan can seem daunting, I believe joining the conversation and planning for compliance creates specific opportunities for Oil and Gas companies:

1. Make Compliance Measurable.

I recently attended a talk from Ronald Schindler of Pioneer Natural Resources, during which he discussed how all they wanted to do was, “live or die by the numbers” regarding environmental compliance. I agree with him entirely – information can set you free.

  • Real information drives real conclusions.
    Putting numbers to a sensitive issue like compliance helps us make better, more informed decisions. Even more important, metrics create an analytical distance that can allow more genuine assessments of what’s going on.
  • You don’t ‘feel’ compliant, you either are or are not.
    Basing compliance actions on gut instinct, some excel files and last quarter’s reports, is just simply not going to cut it anymore. There are ways to make compliance systematic and leave instinct to the areas where it really counts.
  • No one can argue with the numbers.
    Showing a track record of improvement towards measurable goals is a no-brainer in many areas, but for some reason hasn’t quite caught on around compliance. Gather accurate and relevant data, and you can make an argument no one can refute.

2. Standardize Processes and Create Accountability.

Companies are hard at work on creating ways to ensure compliance, from implementing safety programs to creating royalty owner portals. Systems level change requires both standardized processes and accountability.

  • Better understand your processes.
    As more and more processes are created, it’s important to create standards and methods for turning the great strides being taken today into long term processes. In many cases, compliance information you’ve already generated can create a more impactful and lasting change by becoming systematic.
  • Set measurable goals.
    Once you have a clean set of information about compliance, you’ll be able to incentivize change and measure improvements. Identify key stakeholders for compliance in your organization and give them both freedom in implementation and accountability in metrics, and you’ll see great results.
  • Encourage collaboration.
    It’s surprising what types of data management improvements can come from data verification and integration efforts around compliance. Because compliance usually required information from across your organization, gathering and cleaning up that information often improves other processes at the same time!

3. Control Your Role in the Compliance Conversation.

  •  Align goals with implementation.
    Creating an implementation plan for compliance and communicating that plan is extremely valuable in aligning with the ultimate goals (improving safety, reducing contractual noncompliance etc.), rather than letting the nitty-gritty throw the relationship off course.
  • Improve your stewardship reputation.
    Developing a responsive compliance campaign can greatly ease the public’s opinion of your company, whether this be on a local, state or even national level. Developing publically responsive compliance programs can help you engage in a meaningful conversation with people who are becoming larger stakeholders in the industry as onshore operations increase in many locations.

At the end of the day no one wants to cause harm to others, and showing behaviors that match those intentions can mean huge improvements in the relationships with stakeholders that are crucial – especially at this tipping point for onshore oil and gas.

Read part three addressing creating a plan for managing compliance…

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