Trinidad and Tobago-based Phoenix Park Gas Processors Limited (PPGPL) president Eugene Tiah's engineering and MBA backgrounds achieve a state of equilibrium when he discusses the ongoing objective of his company's enterprise risk management (ERM) program.

"Any system that is set in motion requires some energy to keep going," he explains. "For this reason, we are committed to sustaining our effort and continually improving our ERM capabilities over time."

At Phoenix Park -- a joint venture owned by the National Gas Company of Trinidad and Tobago, ConocoPhillips and Texas and Pan West Engineers & Constructors, Inc. (which is owned by GE Energy Financial Services) -- ERM sustainability triumphs over ERM entropy thanks to:

- Unparalleled leadership support;

- Complementary integration with an excellence-minded organizational culture;

- Well-defined processes; and

- Homegrown supporting technology

By combining these elements, the approximately $700 million midstream gas industry business recently jump-started a previous ERM initiative that had temporarily stalled. Today, risk figures into every decision-making process at every level of the company, among several other benefits.

"We have a clear, common language of risk across the organization, literally from shop floor to corporate board room," Tiah notes. "We all are speaking the same language."

Strong Cultural Foundation

This was not always the case.

Phoenix Park initially launched a formal ERM initiative in 2004, but the effort did not achieve its purpose, according to Tiah. Understanding Tiah's criticism of the 2004 effort requires some context because PPGPL's standards related to risk management qualify as exceedingly high for several reasons.

The company, which has operated since 1991, boasts a world-class safety record along with a commitment to excellence in other areas. In addition to operating for 17 years without a lost-time incident and more than 15 years without an employee-recordable incident, PPGPL has earned first place in the Gas Processors Association (GPA) "Accident Prevention Award Division II -- International Classification" for the past 10 consecutive years. It also has been honored with ConocoPhillips's "Spirit of Performance Award" for its safety record.

Phoenix Park also was honored with an International "Stevie" Award for Best Corporate Social Responsibility Program in South America, thanks to its support of low-income families in Trinidad and Tobago. On the financial front, PPGPL is the first company in its country to receive an A rating from Standard & Poor's and Moody's. PPGPL also meets or exceeds all of the financial reporting requirements that come from two of its publicly listed Fortune 100 parent companies.

"The company has a very strong focus on leadership and a very strong focus on excellence, particularly regarding safety," reports Aon Global Leader of ERM Laura Taylor, whose team later provided consulting support to the company. "Phoenix Park really built on these cultural strengths. One of the challenges companies face when they explore enterprise risk management is neglecting to build on what already exists. Phoenix Park did an amazing job of building on their best-in-class strengths."

At first, however, Tiah did not feel that his company's fledgling ERM effort quite measured up to these high standards, despite some promising progress.

"Some aspects of our business actually had a very robust rooting in risk and risk management," he explains. For example, the company's safety management systems, at their core, were risk-based. PPGPL also had developed an awareness of the need for a consistent enterprise-wide approach to addressing risk. "Yet, while we devoted a lot of attention to compliance, we hadn't quite linked compliance, risk management, and governance," Tiah continues. "We wanted to have an approach that actually bridged gaps that needed to be addressed -- including the development of a common language with regard to risk across the organization."