Glad You Asked #7 - What does “Due Diligence” actually mean?
It's one of those phrases that sounds precise and usually isn't.
People use it three ways in the same meeting. Homework before buying a business. Checking out a client before you deal with them. And the legal duty that sits on individuals under work health and safety law.
Only the third has a statutory definition. It's also the one that can put your name on a charge sheet.
In every state and territory (except Victoria), an officer has a personal duty to exercise due diligence to ensure the business meets its safety obligations. (While Victoria does not currently impose the same statutory due diligence duty, officers can still be held personally liable under officer liability provisions where they fail to take reasonable care. In practice, this means directors and senior leaders still need to actively oversee and support health and safety.) Officer takes its meaning from the Corporations Act — people who make, or take part in making, decisions affecting a substantial part of the business. Directors, usually. Often the general manager. Sometimes people who'd be surprised to hear it. A manufacturer, a café group, a recruitment agency: same duty.
Two features catch leaders out.
It's personal and it can't be delegated. You can hand someone the task. You can't hand them the duty.
And it stands on its own. An officer can be prosecuted whether or not the business has been convicted of anything.
The six things it requires
In plain terms:
Keep your safety knowledge current.
Understand what your business actually does, and the hazards that come with it.
Make sure the business has the resources and processes to deal with those hazards — and uses them.
Make sure incident and hazard information reaches you, and that someone acts on it.
Make sure there are processes for meeting the business's legal obligations.
Verify that 3, 4 and 5 are real.
Number six is where it comes apart.
Most compliance money goes to the first five. Policies get written. Systems get bought. Inductions get built. Then nobody checks whether any of it survived contact with the actual work.
A logbook full of service stamps isn't a car that stops.
Where it usually breaks
The failure has the same shape everywhere. The work changed, and nobody told the person carrying the duty.
A machine gets used for a job it wasn't bought for. A roster changes and the fatigue assumptions behind it quietly stop being true. In on-hire it's sharper again, because your worker is on someone else's site doing tasks you were never told about.
That's not a paperwork problem. It's elements 4 and 6 — information reaching you, and you checking the system works. If the answer is "nobody told us", the system exists on paper and not in fact.
So here's the uncomfortable test. If a regulator asked you to show how you satisfied yourself the safety system was working — not that it existed — what would you hand over?
Most leaders can produce the policy. Far fewer can produce evidence they checked it.
Due diligence isn't a document. It's a habit of checking, and a record of having checked.
P.S. If you're in on-hire, Amy Towers and I are running a two-hour session on this for directors and owners — where the duties sit, who carries them personally, and what evidence holds up when someone comes looking. Tuesday 8 September, 10am–12pm AEST, 20 spots.