A Comparison of Responsible Care and Responsible

A Comparison of Responsible Care® and Responsible Distribution Initiatives

AMERICAN CHEMISTRY COUNCIL N AT I O N A L A S S O C I AT I O N O F C H E M I C A L D I S T R I B U T O R S

J U LY 2010

A Comparison of Responsible Care® and Responsible Distribution Initiatives

C O N TA C T S :

David P. Gleason, Senior Director, Responsible Care® American Chemistry Council Michael R. Lang, Vice President, Responsible Distribution National Association of Chemical Distributors

J U LY 2010

©Copyright ACC and NACD

Table of Contents

EXECUTIVE SUMMARY . . . . . . . . . . . . . . . . . . . . . . 1 INTRODUCTION. . . . . . . . . . . . . . . . . . . . . . . . . . . 3 ASSOCIATION BACKGROUND . . . . . . . . . . . . . . . . 5 American Chemistry Council . . . . . . . . . . . . . . . . . . . . . 5 National Association of Chemical Distributors . . . . . . . . 5 SUBJECT AREAS Area #1: Membership . . . . . . . . . . . . . . . . . . . . . . . 6

Summary Background and Perspective Comparison Table. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Area #2: Third Party Verification/Certification . . . . . . . . 8

Summary Background and Perspective Comparison Table. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Area #3: Responsible Care Management System (RCMS®) and Responsible Distribution Protocol . . . . . . 10

Summary Background and Perspective Comparison Table . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Area #4: Security (as reflected in Responsible Care® and Responsible Distribution) . . . . . . . . . . . . . . . . . . . . 12

Summary Background and Perspective Comparison Table

Area #5: Metrics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Summary Background and Perspective Comparison Table Area #6: Governance/Dispute Resolution for Responsible Care® and Responsible Distribution . . . . . 14

Summary Background and Perspective Comparison Table . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 CONCLUSION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 APPENDIX A Program Initiatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 • Responsible Care® . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 • Responsible Distribution . . . . . . . . . . . . . . . . . . . . . . . 21 APPENDIX B Memorandum of Understanding . . . . . . . . . . . . . . . . . . 25 APPENDIX C Reported Membership and Safety Information American Chemistry Council . . . . . . . . . . . . . . . . . . 26 National Association of Chemical Distribution . . . . . 28 GLOSSARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

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Executive Summary The Memorandum of Understanding (MOU) signed by both NACD and ACC Executive Leadership on June 10, 2009 states the following:

“...ACC and NACD agree to complete a comparison of the Responsible Care® and RDP initiatives and to publish the results for use by their members. ACC and NACD also agree to look for opportunities to harmonize the two initiatives to the extent possible. The two organizations will also seek partnership opportunities for training and workshops to further implement Responsible Care® and RDP along the supply chain...” This document fulfils the commitment made in the MoU to compare the two initiatives. This comparison will also serve as the basis for future exploration of harmonization and partnering opportunities. Comparison of Responsible Care® and Responsible Distribution The comparison of the respective environment, health, safety and security (EHS&S) initiatives contains a series of tables defining aspects of each initiative for six selected areas. Summary statements of the comparisons for each of the six areas are provided below. MEMBERSHIP

Summary: There are substantial differences in the associations' primary membership. Any individual, partnership, joint venture, corporation, division, or other unit of a corporation that as a significant portion of its business manufactures or as a principal causes to be manufactured chemicals in the United States of America, and its territories and possessions, shall be eligible to Regular Membership in the American Chemistry Council. ACC has fewer members, but they are, on average, larger in such categories as revenue, number of sites, and employees. NACD requires a candidate status before full membership. NACD requires Responsible Distribution for all members and Chemical Handler Affiliates (CHAs), and ACC requires Responsible Care® for all regular members (chemical manufacturers) and Responsible Care® Partners. In November 2009, ACC established two new categories of membership, Associate Member and Affiliate Member, which cannot use the Responsible Care® logo and do not participate in Responsible Care® activities.

THIRD PARTY VERIFICATION / CERTIFICATION

Summary: Both associations require third-party verification/certification of members in a three year cycle. The resulting audit verification reports are confidential to the company being reviewed. Major differences are the additional stage of candidacy for NACD members, the requirement of all ACC Responsible Care® Partners to be audited (NACD only requires Chemical Handler Affiliates or CHAs), and the number of required sites to be audited/verified within each three-year cycle to meet the respective association requirements. ACC members and Responsible Care® Partners are required to complete certification audits of HQ and a prescribed number of facilities within each three year audit cycle to obtain and subsequently maintain their certification status for the ACC. NACD requires a minimum of one site to be verified that is representative of the member company; however, NACD’s Chemical Handler Affiliates can nominate additional NACD member sites for verification. In the recent third cycle, approximately 30% of NACD members had multiple sites verified.

RESPONSIBLE CARE MANAGEMENT SYSTEM

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( RCMS ® )

& RESPONSIBLE DISTRIBUTION PROTOCOL

Summary: While the spirit and intent of the two initiatives are similar, there are substantial differences in the scope and format of the requirements being verified/certified. Both associations’ verifications/certifications validate that all codes/elements of the programs’ initiatives are in place and

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EXECUTIVE SUMMARY

practiced at each verified/certified site. Responsible Care® requires third party certification at each regular member and Partner company’s headquarters as well as a specified number of operating facilities on a three year cycle. ®

SECURITY (as reflected in Responsible Care and Responsible

Distribution Initiatives)

Summary: Responsible Care® has a stand-alone approach for implementing and reporting thirteen explicitly defined security management practices within the first 2 years of membership/partnership. Subsequently to CEO affirmation of code completion for regular members and Partners, security practices are integrated within the Responsible Care® certification process. Within Responsible Distribution, security-related items are integrated into the Responsible Distribution codes. METRICS

Summary: ACC publishes individual regular member and Responsible Care® Partner metrics as well as aggregate data; NACD publishes aggregate metrics data for its members. GOVERNANCE / DISPUTE RESOLUTION

Summary: Both initiatives have commitments including specific deadlines and adherence to industry accepted EHS&S practices. Both associations have written processes for removing organizations that do not adhere to the respective initiative requirements. The Responsible Care® governance process applies equally to both members and Partners.

Opportunities For Harmonization Opportunities identified to date include the following: • Use of gap analysis to clarify significant differences for further discussion among the respective program leadership groups. • Better coordination and communication between the Associations on advocacy issues of mutual interest. • Communication of areas for mutual support in the areas of grass roots and economic or market data.

Mutual Training And Workshops Partnership opportunities identified to date are as follows: • Joint presentation(s) at each other’s conferences or other events on topics of mutual interest (e.g., emergency response, product stewardship, etc.) • Cooperation on potential webinars or other training opportunities.

For further information or discussion, please contact: •

Dave Gleason, ACC Senior Director, Responsible Care® [email protected]

•

Mike Lang Vice President, Responsible Distribution [email protected]

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Introduction In May 2007, representatives of the American Chemistry Council (ACC) and National Association of Chemical Distributors (NACD) met to learn more about their respective Responsible Care® and Responsible Distribution** initiatives. What followed was a series of regularly scheduled meetings to further the mutual understanding of the two programs and associations. This reached a milestone on June 10, 2009 when a Memorandum of Understanding (MoU) was signed between ACC and NACD. The MoU indicated that the two associations would compare the Responsible Care® and Responsible Distribution initiatives, publish the results for their respective members, and seek opportunities to harmonize the two initiatives to the extent possible. This document is just one step in what we hope is a long and mutually rewarding relationship. ACC’s Senior Director, Responsible Care® and NACD’s Vice President, Responsible Distribution developed the comparison process. The prevailing thought was not to assemble a document that focused only on comparable areas, but to examine key components of the associations and program ini-

tiatives and subsequently share those findings broadly to highlight both differences and areas of similarity. Although many components were discussed, six areas were chosen as those of keen initial interest across the associations: 1. Membership 2. Third Party Verification/Certification 3. Responsible Care Management System® (RCMS®) and Responsible Distribution Protocol 4. Security 5. Metrics 6. Governance/Dispute Resolution This document is intended for general information and depicts the two initiatives as of April 2010.

**Note: NACD’s Responsible Distribution Process or RDP program was renamed “Responsible Distribution” in February 2010

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EXECUTIVE SUMMARY

Association Background American Chemistry Council

National Association of Chemical Distributors

The American Chemistry Council (ACC) was originally founded as the Manufacturing Chemists’ Association (MCA) in 1872. The organization was later renamed the Chemical Manufacturer’s Association and subsequently the American Chemistry Council in 2000. The American Chemistry Council’s mission is to deliver business value to its members through exceptional advocacy based on enhanced member performance, high quality scientific research, communications, effective participation in the political process, and a commitment to sustainable development through member contributions to economic, environmental and societal progress. More simply stated, the ACC’s mission is to be the premiere advocacy organization in the United States.

The National Association of Chemical Distributors (NACD), established in 1971, is an international association of chemical distributor companies that purchase and take title of chemical products from manufacturers. Member companies process, formulate, blend, re-package, warehouse, transport, and market these chemical products exclusively for an industrial customer base of approximately 750,000. NACD’s 250 member companies are located in every region of the country and operate more than 1,600 chemical distribution locations and employ more than 20,000 employees. NACD also has member and Affiliate companies in Canada, Mexico, and Singapore. Member companies are largely entrepreneurial and generally service a particular geographic region and specific industrial sector. They are typically small businesses, although some companies are national and international in scope.

ACC’s advocacy priorities are reviewed and reset annually by its members based on a survey of all ACC member Executive Contacts (CEOs or member company-designated Senior Management Executive). The primary or regular members of the ACC are chemical manufacturers with operating facilities in the United States. Each of these members subscribes to and practices the Responsible Care® program for EHS&S management as a condition of membership. In addition, for those companies participating in the supply chain of the chemical industry but not manufacturers of chemical products, there is a Responsible Care® Partnership program. Participants in the partnership program have similar obligations to regular members with regard to all aspects of Responsible Care®. In late 2009, two additional categories of ACC membership were created – Affiliate Members and Associate Members. These membership categories do not require participation in Responsible Care® and thus preclude direct derivation of associated values from the program; however, they do enable the respective companies to participate in supporting ACC advocacy activities.

For more information, please visit www.americanchemistry.com.

In December 1991, the member companies of NACD undertook the most important mission ever contemplated in the history of the Association, the creation of and required compliance with Responsible Distribution ProcessSM (RDP). This initiative was developed by NACD members for NACD members. In 2010, the NACD Board of Directors voted to change the program name to “Responsible Distribution”. Responsible Distribution is separate and not a part of any other chemical industry code of management practice. Responsible Distribution requires members to continuously improve performance in protecting health, safety, security, and the environment.

For more information, please visit www.nacd.com.

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Membership Summary There are substantial differences in the associations' membership. ACC has fewer primary members, but they are generally larger in such categories as revenue, number of member sites, and employees. In November 2009, the ACC established a program to significantly reduce costs of initial membership for SME (small and medium size enterprise) companies for the first three years of membership. This is to offset estimated costs of initial implementation for Responsible Care®. At that time, the ACC also established two new categories of membership, Associate Member and Affiliate Member, which do not require Responsible Care®; those members cannot use the Responsible Care® logo or participate in Responsible Care® activities. NACD requires a candidate status before full membership. NACD only requires Responsible Distribution with members and CHAs; ACC currently requires Responsible Care® for all regular members and partners ― with staged commitments over time until full management system certification is achieved within a fixed deadline.

Background and perspective ACC • The American Chemistry Council (ACC) was established as the Manufacturing Chemists’ Association (MCA) in 1872, later became the Chemical Manufacturers’ Association (CMA), and then the ACC in 2000. Any individual, partnership, joint venture, corporation, division, or other unit of a corporation that as a significant portion of its business manufactures or as a principal causes to be manufactured chemicals in the United States of America, and its territories and possessions, shall be eligible to regular Membership in the Council. The ACC is the primary advocacy organization for the chemical manufacturing industry in the United States. Today, its 140 regular members (manufacturers) represent approximately 85% of total domestic volume production capacity. All ACC regular members are chemical manufacturers with either production capacity in the United States or marketing chemicals they manufacture outside the United States within the country. ACC members operate more than 1,800 plant sites and employ approximately 275,000 employees as of the end of 2009. ACC

members are required to practice Responsible Care®, and the Responsible Care® Partner program is available to chemical industry supply chain members. There are currently 76 Responsible Care® partner companies employing an additional 250,000 employees. Regular members range in size from less than 50 employees to greater than 25,000. Two new categories of ACC membership were established in November 2009 – Affiliate and Associate. Neither of these categories of membership involves Responsible Care® activities as presently defined. In addition, a new program was initiated to enable SMEs (small to mid-size enterprises) to join the ACC dues free for three years to complete implementation of Responsible Care®. NACD • The National Association of Chemical Distributors (NACD), established in 1971, is an international association of chemical distributor companies that purchase and take title of chemical products from manufacturers. Member companies process, formulate, blend, re-package, warehouse, transport, and market these chemical products exclusively for an industrial customer base of approximately 750,000. NACD’s 250 member companies are located in every region of the country and operate more than 1,600 chemical distribution locations and employ more than 20,000 employees. NACD also has member and Affiliate companies in Canada, Mexico, and Singapore. Member companies are largely entrepreneurial and generally service a particular geographic region and specific industrial sector. They are typically small businesses, although some companies are national and international in scope. All members and Chemical Handler Affiliates are required to be verified with the Responsible Distribution program.

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1: MEMBERSHIP

Subject

ACC

NACD

Definition of regular member

Any individual, partnership, joint venture, corporation, division, or other unit of a corporation that as a significant portion of its business manufactures or as a principal causes to be manufactured chemicals in the United States of America, and its territories and possessions, shall be eligible to Regular Membership in the Council.

NACD members are distributors of chemicals, which as a significant part of their business, take title to goods and resell them.

Categories of participation (other than regular member)

ACC maintains a Responsible Care® Partner program - available to companies not qualified as ACC members and operating within the chemical industry supply chain.

NACD has three affiliate categories, Chemical Supplier Affiliates (CSAs), Chemical Handler Affiliates (CHAs, such as warehouses), and NonChemical Handler Affiliates (NCHAs).

In November 2009, ACC established two new categories of membership, Associate Member and Affiliate Member, which cannot use the Responsible Care® logo or participate in Responsible Care® activities. Basis for dues

Same for both organizations - revenues derived from chemical industry related operations and activities.

Same for both organizations - revenues derived from chemical industry related operations and activities.

Regular membership process

Following Responsible Care® awareness and readiness ‘assessments’ and subsequent Board approval, applicant becomes a ‘Member’. Then, the Member is scheduled for HQ and site (requisite sample) audits, which occur at least one time in every three year cycle. Completion of separate security code is required in fixed time frame after joining; and mandatory metrics reporting starts two years after joining.

Upon Board approval, applicant becomes a "Candidate", and must pass Document Verification to become a "Member". Then, scheduled for site verification (Responsible Distribution Verification), which occurs a minimum of one time (suppliers may nominate other member sites) in every three year cycle. Security-related items are integrated throughout the Code of Management Practice.

Conditions of regular membership

Successfully maintaining RCMS® or RC14001® certification, implementing security code, and annual metrics reporting (public).

Successfully passing Responsible Distribution (including security-related items) and annual metrics reporting (private).

Regular membership demographics (2009)

Total (~140 members): representing 1,850 manufacturing sites, 275,000 employees.

Total (250 members): representing 1,600 sites, 21,000 employees, $20 billion in gross revenue.

Other participants process

Application requires two currently certified ACC members or partners as sponsors, written commitment to Responsible Care®, on-site visit from Responsible Care® special advisor, Responsible Care® Committee review and approval prior to full ACC Board approval.

Application requires at least one NACD member sponsor, and Membership Committee, Regional Organization, and then Board approval. CHAs must also pass Document Verification and Responsible Distribution Verification.

Other participants demographics

Total (76 partners): averaging approx. $30 million revenues and approx. total 250,000 employees.

Total (130 affiliates): Analysis of demographic information not conducted.

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Third-Party Verification/Certification Summary Both associations require third party verification/certification of regular members in a three year cycle. These member audit/verification reports are company confidential. Major differences are the additional stage of candidacy for NACD members, the requirement of all ACC partners to be audited (NACD only requires CHAs), and the number of required sites to be audited/verified within each 3 year cycle.

Background and perspective ACC • The ACC Responsible Care® program, established in 1988, originally required annual self assessment with respect to six “codes of management practices”. This program evolved to a voluntary, peer-review Management System Verification (MSV) process in the mid 1990s and subsequently to mandatory third-party certification. All ACC regular members (manufacturers) and Responsible Care® partners (supply chain companies who do not manufacture chemicals) are required to achieve third-party certification of their headquarters (HQ) and requisite number of facilities on a three year repeating cycle. Certification is achieved by demonstrating conformance to requirements found in one of two technical specifications. The two options for certification are Responsible Care® Management Systems® (RCMS®) and RC14001®. The RC14001 option enables companies to achieve both ISO14001 and RC14001 certification concurrently. The RC14001 option requires a specified number of surveillance audits on an annual frequency. Approximately 50% of ACC regular members and 30% of ACC Responsible Care® Partners are certified to RC14001 with the remainder certified to RCMS. ACC relies on the ANSIASQ National Accreditation Board (ANAB) to accredit third-party auditing firms and the Board of Environment, Health and Safety Auditor Certifications (BEAC) to certify individual auditors.

NACD • In 1992, NACD’s membership agreed to thirdparty verification. The first graduation class of third-party verified members was in 1995. NACD’s membership voted in 1998 to a separate third-party onsite verification (now called Responsible Distribution Verification). NACD’s Responsible Distribution still requires two separate thirdparty verification processes that are conducted by one of two independent third-party verification firms designated by NACD. Responsible Distribution Verification requires each NACD member to be site verified at one of its distribution locations. NACD members are also subjected to additional onsite verifications, called Supplier-Verifications, when requested by NACD’s Chemical Supplier Affiliates (CSAs). All Responsible Distribution Verifications are conducted against a standard protocol based on the Responsible Distribution Guiding Principles and a Code of Management Practice.

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A R E A 2 : T H I R D - PA R T Y V E R I F I C AT I O N / C E R T I F I C AT I O N Subject

ACC/Responsible Care®

NACD/Responsible Distribution

Third party verification

Condition of regular membership in ACC

Condition of membership in NACD

Auditors vs. Verifiers

Auditor service providers (ASP's) maintain formal accreditation from professional accreditation bodies to be qualified to conduct 3rd party certifications. There are currently 13 ASP's maintaining accreditation for regular members and partners to choose to contract with for audit.

Verifiers maintain formal accreditation from professional accreditation bodies to be qualified to conduct 3rd party verifications. Two verifying organizations contracted with NACD are assigned to members' verifications.

Length of association’s on-site audit/verification cycle

Three year cycle. Current second cycle ends December 31, 2010.

Three year cycle. Current third cycle ends June 30, 2010.

Number of sites audited/ verified during cycle

HQ and sample of facilities (based on total sites within the company in the United States) required for third party certification within each 3 year cycle.

One site verified for membership qualification, but all members’ sites are subject to additional site verifications if nominated by NACD's Chemical Supplier Affiliates.

Major association audit/ verification resources to members

Special advisor to members, workshops conducted when interest level is high (free to members), mentoring at annual conference. SMEs are provided consultation and special assistance services for three years.

Mentoring program, webinars, workshops conducted twice a year.

Document verification

Relevant documents (policies/procedures) are audited during formal on-site audits as well as records to prove implementation.

Desktop verification conducted of an organization's policies and procedures. Required for candidates/CHAs to gain association membership; failure results in termination from association. Relevant documents are also verified during members' on-site verification.

Proof of completion; audit/verification reports

Regular members and partners receive and maintain formal 3rd party issued certificates of completion and report their company's status annually in public facing website. The audit report is confidential to the audited member or partner.

Members and CHAs receive and maintain formal 3rd party issued certificates of completion. The verification report is confidential to the verified company.

Cost of on-site audit/ verification

Average is about $2,000/audit day. Total cost is usually $6,000-$10,000 (can vary widely with size).

One person, one day verification is $3,100; two people, one day verification is $5,100 (within United States)

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SUBJECT AREAS

Responsible Care Management System (RCMS ) and Responsible Distribution Protocol ®

Summary While the spirit and intent of the two program initiatives are similar, there are some substantial differences in the scope and format.

Background and perspective ACC • The Responsible Care® program was modified to include mandatory management systems certification in 2003. This certification, typical of a management systems approach, is based on requirements found in the RCMS and RC14001 technical specifications. The specifications include elements in five key areas and are constructed around the classic “plan-do-check-act” management cycle. All ACC regular members and Responsible Care® Partners are required to demonstrate conformance to one of the technical specifications to satisfy their certification requirements. The original Responsible Care® Codes of Management Practices and the existing Security Code have been integrated within the technical specifications and cross-referenced to capture the best practices imbedded in the codes.

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NACD • The Responsible Distribution Protocol is a management system that emphasizes environmental, health, safety, and security performance and consists of 12 codes, which is the same for all members and CHAs. The Protocol is reviewed during each 3 year cycle for analysis and possible enhancements by NACD members, suppliers, and handlers through various NACD groups, such as the Responsible Distribution Committee, Supplier Advisory Panel, Supplier Relations Committee, etc. Any proposed changes to the Responsible Distribution Protocol require approval by NACD’s Board of Directors.

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AREA 3: RESPONSIBLE CARE® MANAGEMENT SYSTEM® RESPONSIBLE DISTRIBUTION PROTOCOL

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( R C M S ®)

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Subject

Responsible Care®

Responsible Distribution

Program’s platform

Formally defined Technical Specifications - same for all regular member and partner organizations and evolving from/incorporating the original 7 codes of management practices.

Responsible Distribution Code of Management Practice: 12 codes, same for all members and Chemical Handler Affiliates. The Responsible Distribution protocol is more prescriptive than the two ACC technical specifications in that it is directed at distributors, where the ACC requirements are applicable to both manufacturers and various business functions in the chemical supply chain (such as motor carriers, railroads, marine).

Industry accepted practices

Based on environmental, health, safety, and security industry best practices.

Based on environmental performance, health, safety, and security.

Options for certification/ verification

Members and partners can choose to certify against either the RCMS® or RC14001® technical specifications. The RC14001 option allows a company to receive both an ISO14001 certificate as well as an RC14001 certificate.

No options.

Internal audits

Internal audits and minimum annual management review required to retain certification. RC14001 option requires annual third-party surveillance audits in addition to proof of (documentation and records) recurring internal audits.

Stipulates annual audits and records retained for next audit.

Organization’s identification of and communications with stakeholders

Technical specification requires: Assessment of stakeholder perspectives; establish and maintain dialogue with employees and other stakeholders; facilitate the flow of information; make product stewardship information publicly available; and periodically evaluate the effectiveness of its communications program with stakeholders.

Required, but does not specify evaluation.

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Security Summary Responsible Care® has a stand-alone approach for implementing and reporting specific security management practices for new, regular members. Following senior executive affirmation of code implementation, maintenance of Security Code practices is confirmed in annually reported security performance metric. Security code aspects are integrated within the Responsible Care® certification process in a manner similar to the integration of security related items in the Responsible Distribution codes.

to the immediate need to address security threats in a manner which allowed effective and efficient mobilization of resources, ACC elected to establish a free-standing Security Code focusing on site, supply chain, and cyber security. Presently, both new regular members and new partners are obligated to complete implementation of security code elements in a fixed time frame after joining. Thereafter, and with code implementation affirmed by company senior management, the ‘reaffirmation’ of maintenance of the security practices in place is required annually with security audited as a component of the Responsible Care® certification process.

Background and perspective ACC • Following September 11, 2001, an ACC CEO led task group sponsored creation of a 13 element “Security Code”. At that time, ACC was in the process of transitioning away from the earlier set of codes of Management Practice to a management systems approach. However, due

NACD • Following September 11, 2001, NACD mandated specific security measures for its members and incorporated these into the 12 Responsible Distribution Codes of Management Practice in April 2002. They remain part of the third-party Responsible Distribution Verification.

AREA 4: SECURITY Subject

Responsible Care®

Responsible Distribution

Security implementation in program

Separate security code adopted in June 2002.

Incorporated within Responsible Distribution’s codes in April 2002.

Leadership commitment

Yes, requires senior executive signature to affirm implementation and annual confirmation of code maintenance.

Yes.

Analysis of threats, vulnerabilities, and consequences

Yes, uses accepted methodologies.

Although Responsible Distribution does not require the use of accepted methodologies, this analysis should be contained within the member's site security plan.

Training, drills, and guidance

Yes.

Yes.

Response to security threats and incidents

Yes.

Yes.

Audits

Yes.

Yes, internal audits to include security issues occur at least once a year.

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Metrics Summary ACC publishes individual regular member and partner metrics as well as aggregate; NACD publishes aggregate metrics of its members.

consideration to the chemical industry. In addition, ACC regular members have established association-wide targets and goals for five of these metrics and will report publicly progress towards these goals starting in 2010. ACC Member and Partner data can be viewed at the website, www.Responsiblecareus.com.

Background and perspective ACC • The ACC has maintained Responsible Care® performance metric reporting since the inception of the Responsible Care® program. Prior to 2003, metrics were reported in aggregate only and not posted for public review. In 2002, the regular member performance metrics were increased in number from 4 to 11. Public posting of metrics on an ACC website by company began in 2004 and has continued annually thereafter. The metrics were revised in 2008 and now number 16 to reflect EHS&S issues of primary

NACD • NACD began the Responsible Distribution Membership & Performance Data Project in 2001 to publicly report membership performance within measurable areas of health and safety. NACD membership voted in 2006 to make annual completion and submission of the questionnaire mandatory for Regular membership in NACD. The newly-named Membership and Safety Report is reviewed and updated on an annual basis at http://www.nacd.com/dist_process/rdp_indices_members.aspx.

AREA 5: METRICS Subject

Responsible Care®

Responsible Distribution

Individual company performance metrics

Condition of regular membership. Specific set of metrics for every regular member and Responsible Care® partner using guidelines and definitions created by consensus among all members and partners and respective functional committees. Currently 16 for each regular member, and from 2 to 10 for each partner depending on partner sector.

Condition of membership. Information is reported confidentially but results for the 14 questions are reported in an aggregate basis to membership, media, and the public.

Communication of performance

Posted annually and individually by company as well as aggregate for all regular members in public facing website.

Aggregate information posted annually on NACD's website, and disseminated to membership, trade associations, and the general public.

Key performance metrics areas

Product stewardship, energy efficiency, transportation safety (DOT, FRA), environmental performance (SOx, NOx, Greenhouse gases, water consumption), employee safety (OSHA, FRA), process safety, security code implementation. Annual organization wide goals set and reported publicly.

Reportable site incidents, reportable injuries, OSHA reportable fatalities, accidents or spills, demographics, etc.

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Governance and Dispute Resolution for Responsible Care and Responsible Distribution ®

Summary Both ACC and NACD’s programs have commitments including specific deadlines and adherence to their respective industry accepted EHS&S practices, which are required to maintain the credibility of the program brand and accompanying recognition.

Background and perspective ACC • Implementation of the Security Code, third-party RCMS® or RC14001® certification at HQ and facilities and annual reporting of metrics are obligatory for all ACC regular members and Responsible Care® Partners. In October 2002, the Board adopted a Responsible Care® Governance Process to establish steps for assisting members and Partners with meeting program milestones (e.g., performance measures reporting, management system certification), while ensuring a process for managing and eventually removing, if required, members and Partners not meeting their obligations. The Board adopted improvements to the Governance Process in 2006 and 2008 to clarify its conditions of use and expedite the process when warranted. In March 2006 and 2010, members were removed in accordance with the Governance Process. All disputes between audit service providers (ASP’s) and audited companies are resolved independent of the ACC – the process being routinely defined in service contracts between the ASP and the company being audited.

NACD • In cases of governance and dispute resolution, a member company is initially contacted by such parties as the verifiers, Responsible Distribution Mentor, and the Responsible Distribution Director. In the event of an ongoing dispute, the matter is brought to the Responsible Distribution Committee for resolution. If necessary, the matter is then escalated to the NACD Board of Directors. If an organization does not successfully complete the requirements of NACD’s membership, including Responsible Distribution compliance, the NACD Board of Directors can terminate the organization’s relationship with the Association.

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AREA 6: GOVERNANCE/DISPUTE RESOLUTION Subject

Responsible Care®

Responsible Distribution

Obligations of membership

Each company (regular member and partner) must have their current Executive Contact sign Guiding Principles of Responsible Care®; complete implementation of security code in fixed time frame and submit Executive Contact signed affirmation of completion; annually submit individual company performance measures which are then posted publicly by company and also in aggregate; complete certification of HQ and requisite number of facilities within a recurring 3 year cycle; and pay annual dues.

Each member must: have application for membership signed by senior management (signature includes agreement to accept the Guiding Principles and Code of Management Practice); successfully complete Responsible Distribution Document Verification to gain membership status; submit its metrics via the Membership & Safety Questionnaire annually; successfully pass Responsible Distribution Verification (site verification) a minimum of once within a recurring 3 year cycle; and pay annual dues.

Governance

Multiple stages progressing from informal contact through Managing Director formal notice; through General Counsel formal notice; to expulsion by decision of Board of Directors of ACC. Governance status is reviewed routinely by internal staff, Responsible Care® Committee (EHS&S managers from both members and partners), Board Committee on Responsible Care® (BCRC - comprised of member company CEOs or Presidents) and ACC Board.

Although not formalized as "governance", multiple stages progressing from informal contact through expulsion by decision of the NACD Board of Directors. Membership status is reviewed routinely by internal staff and, depending on the situation, various committees, such as the Membership Advancement and Retention and Responsible Distribution Committees, as well as the Regional Organization’s officers.

Dispute resolution

Appeals and disputes are resolved between accredited third party ASP and regular member or partner company. Unresolved disputes are submitted to the accreditation body by the member or partner for final decision.

If member company contests the outcome of verification, they are contacted by the verifiers and/or Responsible Distribution Director for resolution. In the event of ongoing dispute, the matter is brought to the Responsible Distribution Committee for resolution. If necessary, the matter is escalated to the NACD Board of Directors.

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SUBJECT AREAS

Conclusion Both Responsible Care® and Responsible Distribution seek to minimize risks of their respective memberships in the areas of environment, health, safety, security, distribution, and product stewardship while enhancing emergency preparedness and response capabilities. Functional similarities exist in the following areas: • • •

Disciplines covered Commitment to external oversight and data reporting Mutual assistance to support implementation and expansion of the initiatives

Key differences exist in the following areas: National governance structures • Candidate members • Auditing standards and processes, including number of facilities audited • Visibility of the security discipline •

ACC and NACD believe that it is in the best interest of the U.S. chemical industry to continue to work together to harmonize programs and processes, address mutual EHS&S issues of concern, and expand the reach of their respective programs. This document is a first step in this process.

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Appendix A: Program Initiatives ACC’s Responsible Care® Initiative RCMS® Elements / Responsible Distribution (NACD) Codes NOTE: This table refers to the Responsible Care® Management System® 2008 version and the 2010-2012 Responsible Distribution Protocol.

# RCMS

RCMS ELEMENT*

RD Code

1.1

Senior management shall develop, document and implement a policy for the organization that recognizes Responsible Care®, and shall communicate it to employees and stakeholders, including members of the public.

I.A., VI.B.

1.2

The policy shall be relevant to the nature, scale and impact of the organization’s operations, products and processes.

I.A.

1.3

The policy shall set a framework for establishing and reviewing Responsible Care® goals, objectives and targets and shall include a commitment to continual improvement.

I.A., X.A.

1.4

The policy shall include a commitment to comply with legal and Responsible Care®-related requirements to which the organization is subject or subscribes.

II.B.

1.5

The policy shall promote openness with stakeholders.

IV.A., B., C.

1.6

The policy shall reflect a commitment to the Responsible Care® Guiding Principles.

1.7

The policy shall be supported by a demonstration of visible leadership, commitment and involvement from senior management and other levels of the organization with respect to Responsible Care®.

I.A.

2.1

The organization shall have a system to identify and evaluate health, safety, security and environmental hazards and assess and prioritize the risks associated with: a) New and existing products; b)New and existing processes; and, c) Changes to existing products and processes. including the distribution, transportation and use of raw materials and products, and activities associated with its operations.

III.A., IV.A.

2.2

The organization shall monitor emerging health, safety, security and environmental concerns relevant to its business and maintain current information related to hazards and risks for: a) Products b)Processes c) Activities associated with its operations

II.B.

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# RCMS

RCMS ELEMENT*

RD Code

2.3

The organization shall have a system in place to review and determine the applicability of regulations, legislation and other Responsible Care® related requirements to which the organization is subject or subscribes.

II.A.

2.4

The organization shall have a process in place to assess stakeholder perspectives.

VIII.A.

2.5

The organization shall establish Responsible Care® goals, objectives and targets as applicable for:

X.A., B.

a) Products b)Processes c) Activities associated with its operations These goals, objectives and targets shall be based upon the organization’s prioritized risks, stakeholders’ input and regulatory, legal and other Responsible Care®-related requirements to which it subscribes. The goals, objectives and targets shall be: established for each relevant function; reflect the organization’s commitment to continual improvement; and • include timeframes and responsibilities for accomplishment. The organization shall have a process to identify and assess program and organizational needs and to allocate resources to meet Responsible Care® goals, objectives and targets. • •

3.1

The organization shall document its Responsible Care Management System® as necessary to ensure its effective implementation, maintenance and control. Documentation shall be legible, dated, readily identifiable and available.

XII.A., B.

3.2

Consistent with the Responsible Care® Guiding Principles, the organization shall establish and maintain systems to:

I.C.

• • • •

manage its prioritized risks; ensure safe operations and maintenance activities sufficient to achieve its policy, goals, objectives and targets; protect the environment, conserve resources, protect worker health and create a safe and secure work environment; and manage change for products, processes and activities associated with its operations, commensurate with risk.

3.3

The organization shall establish, document and communicate responsibilities and accountabilities to meet the Responsible Care® requirements it has set.

V.C.

3.4

The organization shall have a process in place to identify training needs and establish and maintain effective training to address Responsible Care®-related job requirements.

V.A., E.

3.5

The organization shall establish and maintain dialogue with employees and other stakeholders about its impact on human health, safety, security and the environment, its Responsible Care Management System® performance, plans for improving the organization’s performance and management of relevant risks for: a) Products b)Processes c) Activities associated with its operations

IV.D.

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# RCMS

RCMS ELEMENT*

RD Code

3.5.1

The organization shall have a process to facilitate the flow of:

IV.D.

a) hazard and safe handling information along the supply chain to support risk evaluation and risk management of its products; b)appropriate guidance, information and/or training requirements along the supply chain to support knowledge of the relevant risks and hazards associated with the organization’s products, processes and activities; and, c) for receiving such information from suppliers on goods and services used by the organization. 3.5.2

The organization shall have a process to make product stewardship information publicly available.

IX.B.

3.5.3

The organization shall participate in mutual assistance programs and sharing activities as embodied in Responsible Care®.

VIII.A.

3.6

The organization shall involve employees in the development, communication and implementation of Responsible Care® programs. The organization shall have a system to recognize the Responsible Care® performance of employees.

3.7

The organization shall establish and maintain procedures to respond to accidents and emergency situations, and for preventing and/or mitigating the impacts that may be associated with them. These procedures shall include:

VII.7A.—H.

a) appropriate consideration of communications and community recovery needs; b)appropriate participation in the development, implementation and maintenance of community emergency preparedness plans; and, c) an appropriate process for responding to raw material, product, process, waste material and transportation incidents. The organization shall periodically test these procedures where practical. 4.1

The organization shall regularly monitor and measure key characteristics of its operations, products and activities that can have a significant effect on health, safety, security and the environment. This shall include the recording of information to track performance, relevant operational controls and conformance with the organization’s Responsible Care® goals, objectives, metrics and targets.

XI.A., B.

The organization shall use relevant measures and records to analyze health, safety, security and environmental and other Responsible Care® performance and trends. 4.2

The organization shall periodically evaluate its compliance with relevant health, safety, security and environmental legislation and regulations.

X.A., B.

4.3

The organization shall periodically evaluate the effectiveness of its Responsible Care Management System® to determine whether or not it has been properly implemented and maintained. Information on the results of the evaluations shall be provided to management.

X.A., B.

4.4

Commensurate with risk, the organization shall have a process to qualify and periodically review carriers, suppliers, distributors, customers, contractors and third-party providers based on Responsible Care® or other health, safety, security and environmental performance criteria.

III.A.

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# RCMS

RCMS ELEMENT*

RD Code

4.5

The organization shall periodically evaluate the effectiveness of its communications programs with its stakeholders.

VIII.B.

4.6

The organization shall: a) identify and investigate: • incidents and accidents relating to its products, processes and activities associated with its operations; and, • instances of nonconformance with the Responsible Care Management System®. b)identify root causes; c) address and mitigate any adverse impacts; d)initiate and complete corrective and preventive actions; and e) share key findings and associated corrective and preventive actions with relevant internal and external stakeholders.

IX.A., B.

4.7

The organization shall establish and maintain procedures for the identification, maintenance and disposition of relevant Responsible Care® records, including training records, and results of audits and reviews.

XII.A., B.

5.1

Senior management shall periodically review its Responsible Care Management System® and take action to ensure its continuing suitability, adequacy and effectiveness. This review shall address the possible need for changes to policy, goals, objectives and other elements of the Responsible Care Management System®, changing circumstances and the commitment to continual improvement.

XII.B.

* Note: RCMS elements integrate 120 management practices which are embodied in the 7 original RC Codes. RCMS is more specific in areas, such as members’ policy statements, employee recognition, and stakeholder interactions specific to the association’s initiative.

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Responsible Distribution Code of Management Practice Responsible Distribution (NACD Codes) / RCMS® Elements NOTE: This

table referes to the 2010-2012 Responsible Distribution Protocol and the Responsible Care® Mangement System® 2008 Version.

# RD Code

RD Code Description RISK

RCMS Element

MANAGEMENT

I.A.

Senior management’s commitment through communication of policy, implementation of procedures, and the allocation of resources to ongoing improvements in chemical distribution safety, education, health, and security.

1,5

I.B.

Regular review with suppliers of the hazards of materials, revising policy and/or procedures as necessary.

2.3, 4

I.C.

Identification and implementation of risk reduction measures.

2, 3.2, 3.5, 4.1, 5.1

COMPLIANCE

REVIEW

AND

TRAINING

II.A.

A process for monitoring regulations and industry practices for the application to chemical distribution activities.

2.3, 4.2

II.B.

A process for implementing applicable regulations and industry practices that apply to chemical distribution activities.

2.2, 4.2

II.C.

Training for all employees in the implementation of applicable regulations, as well as member company’s specific requirements.

3.4

II.D.

A process for reviewing employee compliance with applicable regulations and member company’s requirements, as well as outside contractor and re-seller compliance.

1.4, 3.4, 3.5

CAREER

III.A.

SELECTION

A process for selecting carriers to transport chemicals that includes carrier safety and fitness, security, regulatory compliance, and performance review.

HANDLING

AND

4.4

STORAGE

IV.A.

Procedures for ensuring that containers are appropriate for the chemical being shipped, comply with regulatory requirements, and are free from leaks and visible defects.

2.1

IV.B.

Criteria for the inspection, cleaning, and re-use of transportation equipment and chemical containers, and the proper disposal of cleaning residues.

*

IV.C.

Procedures for loading and unloading chemicals at the member company’s facilities that result in protection of personnel, a reduction in emissions to the environment, and an increased awareness of hazards from mixing incompatible chemicals.

*

IV.D.

A process for providing manufacturer/supplier guidance and information to customers, warehouses, terminals, and/or carriers on procedures for loading, unloading, and/or storing chemicals, and a process to increase awareness of hazards from mixing incompatible chemicals.

3.5

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# RD Code

RD Code Description HANDLING

AND

RCMS Element

STORAGE

(continued)

IV.E.

A process for selecting owned and contracted facilities and sites for chemical storage or handling that emphasizes safety, fitness, and security including regular/periodic reviews.

4.4

IV.F.

Documentation of current operating procedures for handling and storing chemicals.

1, 2.1, 2.2

IV.G

Facility design, construction, maintenance, inspection, and security practices that promote facility integrity, consistent with recognized codes and regulations.

*

IV.H.

Develop a process for addressing chemical site and chemical transportation security to include conducting a security vulnerability assessment.

*

IV.I.

Provisions for control of processes and equipment during emergencies resulting from natural events, utility disruptions, and other external conditions.

3.7

Procedures to properly label and mark packages and containers.

*

IV.J.

JOB

PROCEDURES

AND

TRAINING

V.A.

Identification of the skills and knowledge necessary to perform each job.

3.3, 3.4

V.B.

Establishment of procedures and work practices for safe operating and maintenance activities.

3.4, 3.5, 3.7

V.C.

Training for all personnel to reach and maintain proficiency in safe work and security practices and the skills and knowledge necessary to perform their job, including confirmation of competence.

3.4

V.D.

Programs designed to assure that personnel in safety critical jobs are fit for duty and are not compromised by external influences.

3.3—3.5

V.E.

Members shall have a process in place to inform contractors of the known hazards and the emergency and/or evacuation plan.

3.5

WA S T E

MANAGEMENT

AND

C O N S E R VAT I O N

PRACTICES

VI.A.

Procedures to ensure that all self-generated waste and empty containers are disposed of in a responsible manner, and in accordance with existing regulations.

*

VI.B.

A clear commitment by senior management through policy communications, resources, and programs to ongoing waste reductions and pollution prevention at each member facility.

*

VI.C.

A commitment to institute resources conservation measures.

3.2

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RD Code Description EMERGENCY

RESPONSE

RCMS Element AND

PUBLIC

P R E PA R E D N E S S

VII.A.

Recognition & Prevention. Processes, policies, and/or procedures that address recognizing the potential for and preventing incidents and chemical releases resulting from man-made or natural events such as spills/leaks, fire, natural disasters, terrorism, etc., involving the member company’s facility or chemicals.

3.7

VII.B.

Notification, Reporting & Response. Processes, policies, and/or procedures that provide for notification, reporting, and response actions by member company’s personnel and/or contractors involving chemical releases and other potential incidents.

3.7, 4.3, 4.6

VII.C.

Preplanning & Coordination. Processes, policies, and/or procedures communicating potential hazards to response agencies about the member company’s facility and physical/chemical hazards as well as pre-planning for appropriate response to such hazards.

3.3, 3.5, 3.7

VII.D.

Training. Processes, policies, and/or procedures to ensure appropriate training of personnel for emergency response and that their response actions are appropriate based on their level of training.

3.5, 3.7

VII.E.

Investigation and Corrective Action. A process for investigating incidents, including near-misses, that resulted or could have resulted in chemical releases, and the implementation of appropriate preventive measures and/or corrective actions.

3.7

VII.F.

Annual Review, Testing, and/or Assessment. Operability of the member company's written emergency action and fire prevention plan and/or emergency response plan.

*

VII.G.

Facility Tours. Promoting initial and periodic facility tours for first responders to promote emergency preparedness and to provide current knowledge of facility operations.

*

VII.H.

Participation. Coordination with Local Emergency Planning Committee’s process or other community organization involved with emergency preparedness and planning functions.

3.7

COMMUNITY

OUTREACH

VIII.A.

Interaction with organizations, associations, government officials, and/or the public on behalf of the NACD’s Responsible Distribution.

1.5, 2.4, 3.5

VIII.B.

Information and updates for employees on Responsible Distribution to encourage key employees to become involved in community outreach efforts.

1.5, 3.5, 3.6

VIII.C.

Advocacy of responsible public policies and regulations for chemical distribution.

3.5

* Since the Responsible Distribution protocol is more prescriptive than the RCMS® technical specification, certain areas of the protocol cannot be sufficiently compared to the RCMS technical specification. This is more reflective of the context of the initiative rather than implying significant differences between the two.

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# RD Code

RD Code Description PRODUCT

RCMS Element

S T E WA R D S H I P

IX.A.

A process to qualify customers as prescribed by governmental regulation.

2.4, 4.4

IX.B.

Member companies should work with stakeholders to foster appropriate dissemination of information on the proper use, handling, and disposal of products commensurate with product risk.

1.5, 2.5, 3.5

INTERNAL

AUDITS

X.A.

Member companies shall establish documented procedures for regularly scheduled internal audits that verify the implementation of policies and procedures supporting the Responsible Distribution Code of Management Practice. The audits shall be conducted on a yearly basis at each member company location used for the distribution of chemicals to evaluate the effectiveness of the policies and procedures.

4.2, 4.6, 4.7, 5 *

X.B.

Audits shall be recorded and results brought to the attention of appropriate management personnel who must take timely corrective or preventive action. Annual audit results should be retained until the next third-party on-site verification is completed.

4.2, 4.3, 4.6, 4.7, 5*

CORRECTIVE

AND

PREVENTIVE

ACTION

XI.A.

Member companies shall establish a corrective and preventative action system for Responsible Distribution-related issues. This system should permit the identification and communication of inadequacies or improvements in each member company’s implementation of Responsible Distribution.

4.6, 4.7, 5

XI.B.

Member companies shall establish and maintain procedures for implementing corrective action and preventive actions arising from internal and external audits or other resources. Any corrective or preventive action taken to resolve the cause or Responsible Distribution implementation inadequacy shall be appropriate, as determined by member company management, to the magnitude of the cause or inadequacy and commensurate with the risk involved.

4.6, 4.7, 5

XII.A.

DOCUMENT

AND

RECORDS

CONTROL

3.1, 3.4, 4.7, 5

Member companies shall establish and maintain a documented system to control all policies, procedures, and records supporting Responsible Distribution.

XII.B.

A master list or functionally equivalent document control system identifying the current version of each document shall be established and be readily available to preclude the use of invalid and/or obsolete documents. Documented procedures shall be legible and identifiable and be appropriate for member company and contracted sites. There shall be provisions for review and approval of any new or revised policies and procedures by the authorized personnel within the member company. Changes to documents and data shall be reviewed and approved by the same function/organization that performed the original review and approval, unless specifically designated otherwise. Functions/organizations shall have access to pertinent background information upon which to base their review and approval, and, where practical, the nature of the change shall be identified in the document or appropriate attachments.

3.1, 3.3, 4.7, 5

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Appendix B: Memorandum of Understanding

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Appendix C: Reported Membership & Safety Information A M E R I C A N C H E M I S T R Y C O U N C I L A G G R E G AT E M E M B E R M E T R I C S Recordable Occupational Injury and Illness Incidence Rates3: Manufacturing, the Business of Chemistry2, Responsible Care® Company1 Employees and Responsible Care® Company Contractors5

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 Manufacturing

13.2

12.7

12.5

12.1

12.2

11.6

10.6

10.3

9.7

9.2

9.0

8.1

7.2

6.8

6.6

6.3

6.0

5.6

N/A

Business of Chemistry

6.5

6.4

6.0

5.9

5.7

5.5

4.8

4.8

4.2

4.4

4.2

4.0

3.3

3.4

3.5

3.2

2.9

3.1

N/A

Responsible Care® Companies

3.61

3.18

3.15

2.93

2.82

2.50

2.16

2.02

1.86

2.13

2.16

2.01

1.72

1.62

1.46

1.23

1.18

1.23

1.03

1.06

1.17

1.05

0.90

0.83

0.82

Responsible Care Company Contractors ®

Recordable Injury and Illness Rate: Defined by OSHA as the number of recordable incidents for each 100 full-time employees per year, based on 2,000 hours worked per employee per year. The calculation is as follows: Annual number of Recordable Cases x 200,000 employee hours Recordable Incident Rate = Annual number of employee hours worked

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A M E R I C A N C H E M I S T R Y C O U N C I L A G G R E G AT E M E M B E R M E T R I C S

(continued)

Reportable Distribution Incidents1 Data for Responsible Care® Companies2 and Volume of Chemicals shipped by the Business of Chemistry3

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Responsible Care Companies Reportable Distribution Incidents

2,142 2,237 2,310 2,189 2,353 2,227 2,162 1,528 1,508 1,402 1,096 1,183 1,224

Business of Chemistry Products Shipped (million tons)

705

®

716

731

736

For more information on ACC’s Metrics, go to: www.responsiblecare-us.com

758

785

763

773

779

799

778

784

816

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Appendix C: Reported Membership & Safety Information (continued) N A C D M E M B E R S H I P A N D P E R F O R M A N C E D ATA R E P O R T

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(continued)

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N A C D M E M B E R S H I P A N D P E R F O R M A N C E D ATA R E P O R T

(continued)

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(continued)

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Glossary Affiliates (NACD): Organizations that do not qualify for NACD Membership. There are three types of NACD Affiliates: • Chemical Handler Affiliates (CHAs): Designed for chemical handlers whose primary function excludes the supply, manufacturing, or distribution of chemicals. Examples include public warehouses, recycler, and carriers. Chemical Handler Affiliates, like NACD members, are required to comply with Responsible Distribution. •

•

Chemical Supplier Affiliates (CSAs): Chemical supplier/manufacturer companies that do not qualify for NACD membership and are not equipment/service providers. Companies must have greater than 50% of their annual revenue attributed to the manufacturing of chemicals. Participation in the Chemical Supplier Affiliate Program provides endless opportunities to interact with NACD member companies – the group responsible for the majority of chemical distribution sales in the United States. Non-Chemical Handler Affiliates (NCHAs): Companies that do not handle chemicals but supply equipment and services to the chemical distribution industry are eligible to join the Non-Chemical Handler Affiliate program. This Affiliate Program was developed in response to multiple requests from non-chemical handlers for a more formal association with NACD members.

Affiliate Member (ACC): A company that is part of the chemical value chain, such as a compounder, plus other industry associations. Affiliate members do not practice Responsible Care®. American Chemistry Council (ACC): The American Chemistry Council represents a variety of companies in the chemical industry. For more than twenty-one years, adherence to the requirements of Responsible Care® has been an obligation of ACC membership. Associate Member (ACC): A service provider, such as a law firm or consultant. Associate members do not practice Responsible Care®. Audit Service Provider (ASP) (ACC): A formally accredited 3rd party auditing company.

Candidate Member (NACD): A new NACD applicant is considered a Candidate member until verified in full compliance with Responsible Distribution. The Candidate must submit proof of third-party verification within two years following the date that the Candidate’s application is approved for membership to NACD. Code of Management Practice: Written guidelines that an organization or professional association issues to its members to help them comply with its ethical standards. Document Verification (NACD): NACD’s third party verification program that reviews documented Responsible Distribution for all NACD Candidate members and Chemical Handler Affiliates. EHS&S: Environment, health, safety, and security Guiding Principles: A broad philosophy or set of business values that guides an organization. ISO 14001: A family of management system standards addressing environmental management issues, developed by the International Standards Organization (ISO). Management System: A modern approach to performance improvement that consists of defined organizational responsibilities, practices, procedures, processes, and resources for developing, implementing and achieving a company’s policies. Membership (ACC): Regular membership is comprised of chemical manufacturers who have physical facilities in the United States or market chemicals in the United States which are manufactured in their facilities outside the United States. Membership (NACD): Regular membership in the National Association of Chemical Distributors is open to distributors of chemicals who, as a significant part of their business, take title to goods and resell said goods. Distributor applicants should share the functional interests of NACD members and must accept and commit to compliance with the NACD Responsible Distribution, its Guiding Principles, and its periodic requirements as a condition of continued membership in NACD.

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National Association of Chemical Distributors (NACD): The National Association of Chemical Distributors (NACD), established in 1971, is an international association of chemical distributor companies that purchase and take title of chemical products from manufacturers. Member companies process, formulate, blend, re-package, warehouse, transport, and market these chemical products exclusively for an industrial customer base of approximately 750,000.

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A N D R E S P O N S I B L E D I S T R I B U T I O N I N I T I AT I V E S

Responsible Distribution Verification (NACD): NACD’s on-site third-party verification process required of each NACD member at one of its distribution locations. Responsible Distribution Verification is conducted by an independent, third-party verifier(s) against a standard protocol based on the Responsible Distribution Guiding Principles and a Code of Management Practice. SMEs: Small to mid-size enterprises.

Partnership Program (ACC): A meaningful extension of the Responsible Care® ethic and its commensurate continuous improvement efforts beyond America’s chemical producers to include their supply chain partners – including their customers, carriers, distributors and others engaged in the business of chemistry. Companies responsible for chemical transportation, distribution, storage, use or treatment and disposal are eligible to become Partners. Companies that are significantly engaged in chemical sales, marketing and logistics may also be eligible.

Technical Specification (ACC): Term used to describe documents which list the requirements for the Responsible Care® Management System (RCMS) or the RC14001 management system. Each is a stand-alone document.

RC14001® (ACC): A management system model which merges the ISO 14001 Environmental Management System Standard and Responsible Care® health, safety, stakeholder dialogue, product stewardship, transportation safety and security requirements. The RC14001 technical specification expands the scope of ISO 14001 to cover all aspects of Responsible Care®. Demonstration of conformance to the technical specification’s requirements results in certification to both ISO 14001 and RC14001. Responsible Care® (ACC): Comprehensive environment, health, safety and security performance improvement initiative implemented by chemical companies in 53 economies around the world. In the United States, the American Chemistry Council manages Responsible Care® on behalf of its members and Responsible Care® Partner companies. Responsible Care Management System® (RCMS® ) (ACC): A “plan-do-check-act” management system model developed by the ACC covering environment, health, safety, security, stakeholder dialogue, transportation safety and product stewardship. The requirements for this management system are found in the RCMS Technical Specification. ACC members and Responsible Care® Partners which demonstrate conformance to RCMS through third-party audits are certified to RCMS. Responsible Distribution (NACD): A third party verification initiative that was developed by NACD members for NACD members. A member-voted condition of membership in the Association is a signed commitment to Responsible Distribution, which requires members to continuously improve performance in the environment, health, safety, and security. ©Copyright 2010: ACC and NACD

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www.nacd.com National Association of Chemical Distributors 1555 Wilson Blvd., Suite 700 Arlington, VA 22209 703/527-6223

www.americanchemistry.com American Chemistry Council 1300 Wilson Blvd Arlington, VA 22209 703/741-5000