R2A Review - A wrap of Engineering Due Diligence
 
 

Welcome to the winter edition of the R2A newsletter. Can you believe that we are more than half way through 2025!  Over the last few months we have been working on a number of interesting projects including a review around the due diligence and risk management processes used to manage a major piece of critical infrastructure in northern Queensland, as well as various training courses and presentations.

We recently wrapped up Season 5 of our podcast (Risk! Engineers Talk Governance). The season’s theme was ‘Conversations Engineers need to have about Risk Management’.  These are sometimes hard conversations and not necessarily popular, but we think it is important that they are had, and they certainly generated some interesting questions and follow up.  This has prompted me to write a section in this newsletter titled: Q&A with R2A.

We are excited to announce that we will be building on these difficult conversations at an in-person event on 21 October at the AICD (Australian Institute of Company Directors) in Melbourne. Relevant legal counsel will be there. There will also be an option for online attendance. More details to follow.

I hope it has been a great start to the new financial year, and if you have any questions relating to engineering due diligence, please get in touch with Richard or I – we are always happy to chat. Email admin@r2a.com.au or call 1300 772 333.

Until next time,

Gaye Francis
R2A Partner

 
 
 
 
 

YOUR THOUGHTS...

 
 
 
 
 

In our efforts to deliver informative and interesting content, we’d love a few minutes of your time to provide feedback on our current newsletter format. 

 
 
 
NEWSLETTER FEEDBACK
 
 
 
 
 

IN PERSON EVENT, MELBOURNE
21 October, 9.30am to 12.30pm

 
 
 
 
 

Following the success of our podcast, we are excited to be finalising details for a half-day, in-person event on Tuesday 21 October at AICD (367 Collins Street) Melbourne. Online registrations will also be available for those interstate and in New Zealand.

While we are still consolidating the program, we can confirm it will run in the morning with morning tea and lunch providing networking opportunities. 

We are excited to confirm lawyer Joe Coleiro and architect Dr Frank Stoks will be guest speakers alongside Richard and Gaye, and we will primarily focus on the SFAIRP way.

We will forward the program outline and ticket information soon, so watch your inbox. Or, register your interest below.

 
 
 
REGISTER INTEREST
 
 
 
 
 

RISK! ENGINEERS TALK GOVERNANCE

Podcast

 
 
 
 
  
 
 

With Season 5, not only did Richard and Gaye discuss “Difficult Conversations Engineers need to have about Risk Management”, but saw us publishing our 50th episode!

We are so thankful for all the support and the wonderful, and growing, following we receive with each episode. When we started, we aimed for the podcast to be down-to-earth and smart conversations around due diligence - just like what it’s like to meet with Richard and Gaye. We are so thrilled to hear from listeners that this is how it feels.

If you’re yet to check out Season 5, click the button below for all the episodes and links to your favourite podcast channel.

 
 
 
PODCAST EPISODES & INFORMATION
 
 
 
 
 

2025 PUBLIC WORKSHOPS 

In partnership with EEA

 
 
 
 
 

Rail Safety National Law & OHS Legislation - Obligations for Engineers & Designers

  • Thursday 21 August, 1:00pm to 4:30pm (AEST)

Audience: This course suits engineers across all disciplines, especially engineers involved in the rail industry. Other relevant roles include: Designers and Project Managers.

Further information and registration via EEA: eea.org.au/courses/rail-safety-national-law-and-ohs-legislation-obligations-engineers-and-designers

 
 
 
 
 

Criminal Manslaughter - How Not To Do It

  • Thursday 4 September, 9:00am to 1:00pm (AEST)

  • Thursday 20 November, 10:00am to 2:00pm (AEDT)

Audience: This course suits engineers and design professionals, and is particularly valuable for board members, senior decision-makers and technical advisers.

Further information and registration via EEA: https://eea.org.au/courses/criminal-manslaughter-how-not-do-it

 
 
 
 
 

Engineering Due Diligence

  • Wednesday 5  & Thursday 6 November, 10:00am to 2:00pm (AEDT)

Audience: This course is a more detailed course for Engineers. It's also suitable for risk and compliance staff of technology-based organisations.

For further information and registration via EEA: eea.org.au/courses/engineering-due-diligence

 
 
 
 
 

We also deliver tailored, in-house workshop briefings. Contact us directly or chat with EEA to organise.

Find out more at www.r2a.com.au/private-due-diligence-briefing-workshops

 
 
 
 

Q&A with R2A

 
 
 

As a result of our podcast, courses and other presentations that we do, we often receive interesting questions and requests for clarifications, especially when there is other (sometimes) conflicting information published online.  We thought we would share some of these with you, as often others have similar concerns. 

Note that some of the questions have been slightly paraphrased so to standalone.  Also, the following responses are provided to give insight but should be thought through for your particular circumstances, as relevant.

We always love hearing your feedback and thoughts, and welcome questions via the below button or email admin@r2a.com.au.

Q: I have been listening to your podcast in pursuit of better understanding risk, due diligence, Rail Safety National Law and duties of engineers etc.  Some topics are hard to rationalise, for example, the relationship and hierarchy of Rail Safety National Law vs for example the Victorian OHS law. Also, what is and isn’t required when it comes to diligence.

A: Initially due diligence was all about negligence in the common law. There are two defences: no power - you can’t be held accountable for something you don’t control, and due diligence, that to the extent that you have control, you have ensured that all reasonably practicable controls are in place for all reasonably foreseeable hazards.

That became a statutory duty in Vic in the 2004 OHS Act, but without any mention of due diligence, as such. But it did spell out the duty of designers - SFAIRP. That is, elimination and if this was not possible, risk reduction, so far as is reasonably practicable (SFAIRP).

When the model WHS Act turned up, it spelt out the due diligence duty of the business’s controllers (the board, etc.) as they have final say on the money and hence control. There can be discussion as to why that was done, but we suspect it’s got a lot to do with trying to ‘pierce the corporate veil’. Those in control just can’t say it’s all someone else’s problem, that they delegated the responsibility and accountability to someone else. They (the company’s officers) always retain accountability to ensure that the Person Conducting the Business or Undertaking (PCBU) demonstrates that all reasonably practicable controls are in place for reasonably foreseeable hazards.

However, the SFAIRP duty of designers (meaning engineers) remains the same as the Vic Act. 

To us at R2A, due diligence is all about pre-event design (the current popular term is safety-in-design) that can survive post-event scrutiny.  And engineers, especially as employee designers, have that SFAIRP (due diligence) duty to ensure reasonable care that this is achieved.

Q: Our organisation is using the concept of the "Cost of Risk". How can this be used to ensure effective risk management which can then be translated into cost improvement (or something to this effect).

A: When the issue of concern just involves property loss with business interruption and, perhaps, reputation damage costs, it’s all pretty straight forward.

However, it gets much more complex if a dollar value for human harm or death is included, which some economic modellers like to do. But because of the negligence implications of the WHS legislation for management, including the dollar value of a human life as an arbiter to make safety decisions has become much more complex.

These days we prefer to use a pros and cons approach in a stakeholder workshop where all the concerns and benefits of the alternative courses of action are expressed in a less explicit manner.  Doing this on a disproportionality basis seems to be the optimal approach at the moment.

Q: Always a great podcast! There are still those in industry that believe SFAIRP is a cheap 'do nothing' approach, which is very far from the truth. I have come across people that are uncomfortable with SFAIRP because "it can only be decided by a judge" (and therefore no one else). Are you able to go over strategies to prove SFAIRP has been achieved?

A: There are a few strategies that we use to demonstrate SFAIRP. The first is to make sure the right stakeholders are involved in the process and it isn’t completed by a single person in isolation. The next thing is to ensure that the group can demonstrate that a structured and rigorous process has been completed.  The group then needs to document that process and the additional controls that have been considered, and most importantly, the reason(s) why each of these are considered SFAIRP or not, usually in the form of a pros and cons table.  The elements to consider are expense, difficulty and inconvenience and utility of conduct, meaning what good things go missing if you adopt that course of action.  We actually think it is more important to document why you are not going to do something.

Depending on the issue of concern and the context of the situation, the SFAIRP assessment may need to be revisited, and potentially revised as time goes on and circumstances change.  For example, there may be an emerging technological solution that may not be reasonably practicable in 2025 due to expense or that it hasn’t been proven for your particular application, but that may change over time.  

These are living assessments / documents that need to be reviewed and updated as required.

 
 
 
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