‘Due Diligence’ continues to expand in legislation

Richard RobinsonDue Diligence

The changes set in motion by the 2011 National Model Work Health and Safety legislation are becoming apparent. Designers, owners, operators, regulators and the Courts are beginning to come to terms with the WHS Act’s imposed duties for organisations’ officers to ‘exercise due diligence’ in their safety risk management processes.

Due diligence is also a concept in both environmental protection and the broader context of sustainability, one of a number of parallels with health and safety. It is closely linked to how we view environmental impacts as part of the Technological Wager. That is, “society … betting on the success of future innovations to bail us out of problems created by present innovations”, as recently expounded by Adam Briggle in ‘A Field Philosopher’s Guide to Fracking’. One’s willingness to accept longer odds will reduce what one considers diligent at the time of the wager. That is, if we’re more confident of dealing with the mess we make now in the future, we may accept fewer or less effective precautions against the mess in the first place.

The recent amendments to Queensland’s Environmental Protection Act introduced (inter alia) a ‘due diligence’ test which the Department of Environment and Heritage Protection can implement when determining if a party took all reasonable steps to comply with their environmental obligations under the Act. Madeline Smith of Herbet Smith Freehills notes that amongst other matters it raises a range of questions as to what constitutes reasonable due diligence for an investor, financier or parent company with respect to, for instance, a subsidiary or investment company’s environmental obligations.

We watch these developments with interest.