Safety Culture Summit, NEB Chair & CEO Peter Watson remarks


Halifax, Nova Scotia

October 12, 2017

National Energy Board Chair/CEO Peter Watson

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  • Good morning.
  • I’m pleased to be here today to present the National Energy Board’s perspectives on Regulatory Excellence – the Role of Safety Culture.
  • Over the past few years, you have likely heard about the NEB and the work we do.
  • As Canada’s national energy regulator, the NEB is mandated to regulate interprovincial and international pipelines, which if laid end-to-end would wrap around the earth nearly two times.
  • The NEB is a lifecycle regulator. We oversee the safety and environmental protection of a pipeline project from the application assessment phase, through to construction, operation, and eventual abandonment.
  • Our work places us squarely in the midst of the most important public policy debates in Canada.
  • From pipeline safety, to controversial pipeline projects, to the relationship Canada has with Indigenous Peoples…
  • The NEB is in the middle of it all.
  • And we do this work so that Canadians can count on us and have confidence in how we deliver on our mandate – so that the public is safe and the environment is protected.


  • So, as a regulator, how are we going to do that?
  • By being accountable and by striving towards excellence in everything we do.
  • That means every facet of our work needs to aspire to excellence,
    • from transactional regulatory activities – reviewing project applications and assuring compliance with standards,
    • to our internal management system and the data/information and knowledge that allows us to assess the effectiveness of company management systems and the systemic performance of the industry,
    • to our understanding of the human issues – safety culture generally and the importance of our own oversight culture.
  • And over the past eighteen months, that commitment has informed much of our thinking on how we do our work at the NEB.

Regulatory Excellence & Management Systems

  • As I said before, if the public is to have sustained confidence that the pipelines we regulate are safe and the environment is protected, than we need to aspire to excellence in absolutely everything we do.
  • To do that, you need excellent management practices.
  • So in 2016, we implemented what we call we call our ‘Departmental Results Framework.’
  • It sets a clear direction for the NEB and illustrates exactly what we do, what we aim to achieve, and how we will report our outcomes to Canadians.
  • By focusing on achieving Regulatory Excellence and implementing our new Departmental Results Framework, the NEB is going through nothing less than a transformation.

Regulatory Excellence - Our Journey

  • To a great extent, our experience over the past months has resulted in us getting “unstuck” from a way of thinking that had hindered us from asking ‘what can we do better?’
  • And now that we feel “unstuck” from some of our former patterns, I think we as an organization are feeling a lot of excitement about the possibilities ahead of us.
  • We are continually challenging ourselves and asking,
    • “What does regulatory excellence mean to us?” and,
    • “What are we going to do to achieve it?”
  • These questions have led to significant reflection and learning across our organization – and a focus on the prevention of harm within our regulatory jurisdiction.

Preventing Harm

  • Our first key learning relates to the need for the regulator to move beyond traditional transactional business towards awareness and understanding of the big picture.
  • The work we do is critically important. I believe that regulators are in very privileged positions – positions that actually affect the lives of Canadians every day.
  • What a great place to be, to have a direct impact on things like safety, security, innovation and prosperity for Canadians.
  • We have the ability to look at systems, to test their quality, and to lead improvement. We can lead changes and make things better. This is powerful.
  • And in being regulatory leaders, we also have the tremendous responsibility to never let our vigilance down because a lot is riding on the work we do every day – even those days when we feel like we can barely keep up with the emails and the meetings. 
  • It is important not to get stuck in the transactional aspects of our work. I think it’s easy to put our heads down and focus on our particular tasks – but what we need to do is to stay aware of the bigger picture of what is happening around us and what we are going to do about it.
  • We must also push for the opportunities – beyond safety monitoring and compliance at the company level – to influence the broader system at an industry level, and beyond.
  • Compliance itself is a snapshot in time, and although it serves as a necessary defense against harm, it is a transactional focus.
  • The NEB ensures that its focus is on risk, which is informed through a model that considers both probability and consequence.
  • We couple this focus with the driving of management system improvements.
  • Management systems are a key defense against harms and go beyond a transactional compliance focus.
  • Utilizing data and trends from both activities, we use a risk informed model to plan our actions to improve the outcomes as defined in the Departmental Results Framework.
  • This effort to go beyond transactional business to the big picture leads us to the issue of culture being an additional layer of defense against harm.

Safety Culture

  • The NEB looks beyond compliance with standards.
    • ‘Standards’ are the minimum we expect as a regulator. It is the minimum that the public expects.
  • But I don’t think “minimum” is the word that should come to mind when we are talking about preventing incidents and all of the associated risks that come with them.
    • We need to drive management system improvement and focus on safety culture, to ensure that we are in fact doing everything we reasonably can to prevent harm.
  • When we look at all the attributes of a positive safety culture, they provide valuable insights on how organizational culture influences outcomes.
  • This is important because what we regulate touches the lives of Canadians every day. It affects what matters to them: their land, their water, and their community.
  • It’s what regulating with excellence or “regulatory excellence” demands of us. It’s about the perpetual pursuit of excellence.
    • Always looking for ways to improve, always looking for ways to be better.
  • When it comes to safety we all have a stake in this game. We have to stop thinking about each of us as individual players and look at the bigger picture.
    • We need to come together and collectively improve.

How Safety Culture is Impacting Our Work

  • This notion of safety culture has had considerable impact on our work and our organization.
  • In terms of our role as the regulator, we understand that culture, and the human factor, are at the root of performance issues.
  • We recognize that leadership is key to maintaining a healthy safety culture. An organization that has a strong safety culture scrutinizes – as a normal business function – every decision it makes to ensure that risk is managed appropriately.
  • As a regulator, we obviously cannot control culture but we expect we can influence it - by raising awareness and advocating for it with industry and other regulatory agencies.
    • We can do this effectively by collecting, analyzing and sharing industry-wide data and information to facilitate systemic learning and improvement.
  • The Board has been actively engaged in the development and promotion of Safety Culture since 2012. Though it is not a regulatory change – this effort does represent a major shift in our approach to proactively managing safety at that systemic level.
  • Where an organization is strongly in tune with establishing and maintaining a positive safety culture, it scrutinizes - as a normal business function - every decision to ensure that risk is considered and managed appropriately.
  • It sets performance measures that provide a complete picture of the organization’s current state in order to identify areas of weakness and to proactively manage safety in advance of an incident.
  • A strong safety culture is also characterized by continual learning - learning from internal experiences but also learning from others’ - with the goal of preventing catastrophic accidents.

Leveraging Safety Culture

  • In 2013, North American oil and gas regulators came together to discuss improving safety and environmental outcomes by leveraging safety culture.
  • During that meeting, several opportunities were identified by the regulators to move a concerted safety culture effort forward, including:
    • Building a shared understanding of the term safety culture;
    • Articulating clear regulatory expectations as they relate to safety culture; and
    • Collaborating on the development of resource material for industry in order to provide clarity and consistency in terminology, and safety culture attributes.
  • A year later, we created the North American Regulators Working Group on Safety Culture. 
  • To date, this group has collaborated on safety culture research and developed a suite of indicators that directly correlate to the NEB safety culture framework.
  • This year, the group will focus on;
    • the practical application of these indicators to gather signals related to safety culture during oversight activities,
    • developing internal safety culture competency,
    • and understanding and assessing the regulator’s own safety oversight culture.
  • This last point is key – we are holding the mirror up to ourselves as well.
  • We recognize the influence of organizational culture on outcomes and we want to understand how our safety oversight culture may be supporting - or potentially hindering - industry efforts to advance safety and environmental protection.


  • Every organization that I know of has Corporate Values. They often live on the wall in the Boardroom or maybe in reception. But it is imperative to ask:
    • Are your organization’s “values” actually driving your culture or are your values “a sign on the wall”?
    • Are your values reflected – and reflected prominently – in your business planning and in your processes?
    • Is committed leadership visible at all levels of the organization?
  • This is what we, as the regulator, are asking our regulated entities – and we are asking similar questions of ourselves.


  • Regulatory Excellence is not a one-time exercise. It is how we will operate as a regulator.
  • The NEB will have to continually work to seize opportunities and to take proactive action against potential weaknesses and risks, including those relating to organizational culture.
  • Regulatory Excellence does not happen by chance - it takes disciplined effort and perseverance - and it truly is a perpetual pursuit.
  • And so we will continue to set higher performance targets for ourselves – and that includes exploring how we can influence systemic improvement and leverage awareness and understanding of culture to achieve our outcome of zero harm.
  • Thank you.

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