Changes to PDO’s Approach to HSE Competence Assurance

1. Changes to PDO’s Approach to HSE Competence Assurance

2. Changes to HSE Competence Assurance • A number of significant changes are being introduced to PDO’s requirements for HSE competence assurance of: • Leadership Positions • HSE Critical Positions responsible for Planning/Supervisory HSE Critical Activities (formerly called ‘Level 2 HSE Critical Positions’) • The changes are based on the new approach adopted by the Shell Group, but tailored to PDO’s operating environment • The main objectives of the changes are reductions in: • the number of positions requiring assurance; • the number of potential competence requirement profiles; • the number of HSE competences to be assured. • For the moment, requirements will remain unchanged for the assurance of: • HSE Professional Positions and • HSE Critical Positions Responsible for Front-Line Operational HSE Critical Activities (formerly designated ‘Level 1 HSE Critical Positions’)

3. Changes to HSE Competence Assurance The Overall Process Remains Unchanged Competence Assessment Process N.B. The Line Supervisor carries out the assessment unless they are not confident In their own competence and capability to do so, in which case they can invite input from an approved assessor

4. Changes to HSE Competence Assurance Summary of Changes* • Positions Requiring Assurance • All positions JG 1+ • ‘Level 2 HSE Critical Positions’ • Only Senior LT members (Exec Directors) • HSE Critical Positions Responsible for Planning/Supervisory HSE Critical Activities (but more narrowly defined - only those managing ‘Red RAM’ Risks) • Which Competences Require Assurance • Technical/Operational Competences (as set by the Discipline) in SAPpHiRe • HSE Competences • Unchanged • Unchanged BUT the number of Competence Elements is reduced from 12 to 3 • HSE Competence Requirements • 18 Profiles (driven by Function & JG) • 9 Profiles (driven by role in HSE risk management) * N.B. The changes adopted apply only to Leadership Positions and HSE Critical Positions Responsible for Planning/Supervisory HSE Critical Activities. The requirements applying to HSE Professional Positions and HSE Critical Positions Responsible for Front-Line Operational HSE Critical Activities (formerly called ‘Level 1 HSE Critical Positions’) remain unchanged

5. Changes to HSE Competence Assurance Criteria for HSE Critical Positions Responsible for Planning/Supervisory HSE Critical Activities • The principal criterion is that the position has a significant influence on the management of Red RAM Risks • Such influence arises because they either: • Take (with a high degree of independence) significant technical or planning decisions, which affect the establishment, implementation and maintenance of controls for such risks and/or • They supervise or manage front-line operational activity involving such risks (and therefore are responsible for effective implementation of controls)

6. Changes to HSE Competence Assurance Comparison of 12 Old & 3 New HSE Competences Rationalised HSE Competences 1 - Provide Leadership in HSSE (‘HSE Lead’) 2 – Prepare Effective Management of HSSE Risk (‘HSE Prepare’) 3 – Apply Effective Management of HSSE Risk (‘HSE Apply’) Shell Uses the term HSSE, PDO will continue to use HSE There is linkage between the old and the new, but the new structure consolidates and reduces the ‘technical/professional’ HSE requirements and focuses on capabilities required by Line personnel N. B. Existing completed assessments in SAPpHiRe will be automatically ‘converted’

7. The structure of HSE Competence Elements remains the same; Each consists of a Summary Statement, which includes a list of the activities it encompasses; The Proficiency Levels (Awareness, Knowledge & Skill) remain unchanged; Proof Points (competence criteria) have been set for each Proficiency Level of each Competence Element; PDO has adopted the new Shell competence Summary Statements and Proof Points but with some minor tailoring to ensure clarity and understanding in the PDO operating environment; PDO will not use ‘Mastery’ (no positions require it) Changes to HSE Competence Assurance Structure of New HSE Competence Elements

8. Changes to HSE Competence Assurance New HSE Competence Elements Lead HSE Risk Management (‘HSE Lead’) Can deliver continuous improvement of HSE performance through pro-active HSE management, relentless pursuit of adherence to policy and standards, exemplary personal leadership behaviour, provision of appropriate organisation and resources, and systematic review of effectiveness. Specific activities covered by the scope of ‘HSE Lead’ are: - Be mindful of HSE risks and drive the consistent application of PDO’s HSE MS, systematically reviewing its effectiveness and taking corrective action as necessary. - Demonstrate visible and felt leadership by communicating a clear vision, setting and championing challenging performance goals (such as Goal Zero) and consistently demonstrating the importance of HSE via personal involvement, visibility, decisions and actions. - Motivate, coach and develop staff and contractors towards improving HSE culture and behaviours through promotion of the Golden Rules and personal example as a role model. - Deliver compliance with applicable laws, regulations and PDO HSE requirements, applying consistent Consequence Management. - Engage with stakeholders and set long-term HSE objectives in line with expectations whilst adhering to HSE Policy. Take ownership of HSE input to the PDO Annual Assurance Letter.  

9. Changes to HSE Competence Assurance New HSE Competence Elements Prepare HSE Risk Management (‘HSE Prepare’) Can identify and assess HSE risks systematically and define the standards, plans, procedures and resources necessary to manage them.  Specific activities covered by the scope of ‘HSE Prepare’ are: - Identify the HSE hazards and assess the potential consequences. - Define the barriers required to control the identified HSE hazards and the recovery measures needed. - Select, establish and maintain the required resources, standards and procedures to manage business, personal and process HSE risks (including during change and across organisational interfaces). - Identify those positions (HSE Critical Positions) responsible for the implementation or management of controls to prevent significant incidents and maintain adequate competence. - Establish HSE action plans and targets integrated within overall business plans. - Establish required emergency response capability and plans. - Establish Risk based audit plans to assure compliance with relevant standards and requirements.

10. Changes to HSE Competence Assurance New HSE Competence Elements Apply Effective HSE Risk Management (‘HSE Apply’) Implement the policy, strategic objectives, plans and identified risk management requirements, establish safe systems of work and monitor effectiveness through audit and performance management. Classify, investigate and report incidents in a systematic way, in accordance with PDO requirements. Specific activities covered by the scope of ‘HSE Apply’ are: - Implement systematic HSE management in accordance with the HSE-MS. - Establish safe systems of work so that HSE risk remains as low as reasonably practicable for work undertaken. - Monitor and review activities to ensure continuous improvement in HSE performance whilst updating relevant standards and procedures as necessary. - Monitor and analyse HSE performance using both reactive (lagging) and proactive (leading) indicators, in accordance with PDO Standards. - Classify, investigate and report incidents systematically, in line with PDO requirements. - Identify underlying causes of incidents using appropriate tools and implement appropriate actions. - Participate in relevant internal audits to confirm that risk controls are in place and effective

11. Changes to HSE Competence Assurance Examples of Competence Proof Points HSE Lead: Awareness Level

12. Changes to HSE Competence Assurance Examples of Competence Proof Points HSE Prepare: Knowledge Level

13. Changes to HSE Competence Assurance Examples of Competence Proof Points HSE Apply: Skill Level

14. Changes to HSE Competence Assurance Criteria for Leadership Positions Positions that directly influence HSE decision making at Leadership Team level. In PDO such positions have been defined as Executive Director positions

15. Changes to HSE Competence Assurance Criteria for HSE Critical Positions Responsible for Planning/Supervisory HSE Critical Activities

16. Leadership Positions Planning/Supervisory HSSE Critical Positions Changes to HSE Competence Assurance New HSE Competence Requirement Profiles Fn’l Sup’t Gen Mgt/ Bus Ops/ Tech/ Eng Systems Support Ops/Tech/Eng Competence Element LDR-1 LDR-2 LDR-3 SPT-1 SPT-2 OTE-1 OTE-2 OTE-3 OTE-4 HSSE Lead Provide Leadership in HSSE K S S A K A K S S HSSE Prepare Prepare Effective Management of HSSE Risk A K S A K K K S S HSSE Apply Apply Effective Management of HSSE Risk A K K A A K S K S • 18 profiles/12 elements (Yellow Guide) rationalised to 9 profiles/3 elements • New approach requires selection of best profile to suit role in risk management rather than profile being determined by Job Type/Group • Already completed assessments will be ‘converted’ from 12 to 3 in SAPpHiRe Shell Uses the term HSSE, PDO will continue to use HSE

17. Changes to HSE Competence Assurance Key Implementation Steps • Develop Supporting Documentation • Identify Positions and Allocate Requirement Profiles • Make Necessary Changes to SAPpHiRe & Convert Existing Assessments • Develop Training/Guidance Materials • Develop Communications Support Material • Brief Staff Affected • Set & Communicate Targets for Completing Assessments • Monitor Progress

18. Changes to HSE Competence Assurance Implementation Status Develop Supporting Documentation • The Competence section (3.3.2) of the PDO HSE MS will be updated – text prepared; • A new PDO HSE Procedure has been developed, which • Sets out the revised assurance requirements and defines responsibilities for their application • Defines the HSE competences and position requirements • A new PDO HSE Guideline has been developed which provides guidance for position holders and supervisors/assessors on carrying out HSE competence assessments.

19. Changes to HSE Competence Assurance Implementation Status Identify Positions and Allocate Requirement Profiles • The HSE Skill Pool Manager has, in consultation with Functional Skill Pool Managers, reviewed and updated the current list of ‘HSE Critical Positions’ in SAPpHiRe; • The same process has been used to allocate the most appropriate HSE competence requirement profile to each position; • Line Managers and Supervisors will be expected to review the positions and profiles and identify any they consider to be inappropriate.

20. Changes to HSE Competence Assurance Implementation Status Make Necessary Changes to SAPpHiRe & Convert Existing Assessments • Actions are in hand to: • Identify the new HSE Critical Positions in SAPpHiRe and to change the HSE competence requirements for those positions; • Change SAPpHiRe to include the new HSE Competence Element descriptions and the new Proof Point requirements; • Convert existing, completed assessments in SAPpHiRe from the old 12 HSE Competence Elements to the 3 new ones; • Any assessments still ‘in progress’ will need to be completed in SAPpHiRe before the changeover date.

21. Changes to HSE Competence Assurance Implementation Status Develop Training/Guidance Materials Develop Communications Support Material • The following have been developed: • A presentation slide pack explaining the changes; • Communications on the changes for posting on the HSE web site; • A guidance/training pack to assist position holders and line supervisors/assessors to carry out assessments • SAPpHiRe guidance material for staff, supervisors and assessors.

22. Changes to HSE Competence Assurance Implementation Status Brief Staff Affected • A general communications plan has been developed, designed to give general information about the changes to key stakeholders; • The HSE web site material will give specific guidance to the various groups of people potentially affected.

23. Changes to HSE Competence Assurance Implementation Status Set & Communicate Targets for Completing Assessments Monitor Progress • Directors will be recommended to set targets for the completion of assessments and the documentation of plans for ‘managing gaps’; • It is expected that assessment completion targets will be set by each business organisation as part of their HSE business planning process and that they will monitor and report performance; • The HSE Skill Pool Manager will provide a report to Directors, at least annually, which shows the status of competence assessment : • Assessment completed (no gaps) • Assessment completed (gaps) • Assessment partially completed • Assessment not yet started

24. Changes to HSE Competence Assurance Issue: How to Handle Non-HSE Critical Positions • The competence requirement profiles in SAPpHiRe, which were set by the PDO Technical Discipline (based mainly on previous Shell requirements) contain a limited number (3-6) of the previous 12 HSE competence elements; • Some assessments have been completed against those requirements; • Any assessments completed using the old 12 competence elements will be converted to the new 3 elements; • HSE competence requirements for these positions will be deleted in SAPpHiRe in line with the Shell approach; • CFDHs may define requirements for particular positions.

25. Changes to HSE Competence Assurance Issue: How to Handle CHs & CSRs • Previously, Shell defined minimum HSE competence requirements for CHs and CSRs of High/Medium HSE risk contracts; this has ceased under the new requirements; • PDO had previously defined specific additional competence requirements for CHs and CSRs and required them to complete an additional assessment; this will cease; • CHs and CSRs for high risk contracts will, by definition, continue to be considered HSE Critical and be assessed against the requirements specified for their position; • In addition they will need to meet minimum CH/CSR training requirements, defined by MSE/1.

26. Changes to HSE Competence Assurance Issue: Process Safety Competence • The Shell Group has developed a proposed Process Safety Capabilities Framework to define specific process safety competence requirements for ‘PS Relevant’ Leadership & HSE Critical Positions; PDO expects to adopt this, when finalised; • The PS Framework has many similarities to the mainstream HSE Competence Framework but has a different set of four competence elements and a different requirement structure; • It is proposed that: • The CFDH for PS identifies (in conjunction with functional SPMs) the specific positions requiring PS competences (this will be a sub-list of the main list) and the PS competence requirements, which should apply; • The PS competence requirements will be added into the position requirements recorded in SAPpHiRe, similarly to Operational/Technical competences; • Timing will depend on the finalisation of the framework

27. Changes to HSE Competence Assurance Issue: Approved HSE Assessors • The process allows for the use of ‘approved assessors’ if the line supervisor does not feel confident in carrying out the assessment; • The responsibility for approving HSE assessors is with MSE1; currently the number is small (HSE TLs) and few have recent assessment experience and none are familiar with the new HSE competence framework and requirements; • In response: • The process for approving assessors is being better defined together with MSE1; • The implementation plan includes provision for assessor training, assessment and (re)approval. • Providing timely assessment support will need to clearly built into assessors’ personal performance contracts.

28. Changes to HSE Competence Assurance Summary of Actions Required by Line Managers • Review the HSE Critical Positions under their responsibility and confirm that the positions and allocated HSE competence requirements are appropriate (or review and change, in consultation with their SPM and the HSE SPM); • Propose changes to Critical Positions and HSE competence requirements as and when change takes place; • Review the ‘conversion’ in SAPpHiRe of any previous assessments of staff under their control and raise any issues with the functional SPM and HSE SPM; • Carry out or complete the assessment of any Technical/Operational Competences not yet assessed; • Carry out or complete the assessment of any HSE competences not yet assessed using guidance provided; • Develop, document and implement risk-based plans for managing any competence gaps identified; • Carry out the above together with position holders.

29. Changes to HSE Competence Assurance Summary of Actions Required by SPMs • Coordinate and support the review and update of the HSE Critical Positions in their function and the allocation of appropriate HSE competence requirements (in consultation with MSE/6); • Support line supervisors in reviewing the ‘conversion’ in SAPpHiRe of any previous assessments of staff in their function and support issues resolution (in conjunction with MSE/6); • Advise MSE/6 of any proposed changes to positions or requirements as a result of changes in position responsibilities or organisation in their function; • Provide advice and support to line supervisors on competence assessment and development related issues; • Coordinate the monitoring of progress in completing assessments and the gaps identified.