Introducing risk management into your organisation
Risk Management at first glance can appear a daunting task.
As well as all the other issues that come with managing a community organisation, finding time to go through the process of identifying all the risks that could affect your organisation and how to deal with them can be tough.
It is far easier if it is done as a joint, cooperative exercise, with the backing of all levels of the organisation, particularly the Board or committee.
The first thing to do is to convince all involved that the exercise is necessary and with the furore over the whole issue of public liability insurance over the past year, that should not be difficult.
At this stage it is also important to win the support of everyone in the organisation because it is the people who are actually doing the jobs or working as volunteers who have the best idea of the risks involved - and usually good ideas on how they can be managed.
Establishing a risk management strategy is not about criticising how things were done beforehand. It is about ensuring the future safety of your organisation and the people involved in it (and those who come into contact with it).
The focus of this Help sheet is to assist in bringing people with you on the risk management journey and to ensure that the key message that you present is that by going through this process the whole organisation will be safer, more effective and hopefully richer.
So why undertake a risk management program?
There are obvious benefits of undertaking a risk management program particularly as it relates to public safety. These benefits may include:
While insurers and most groups think of the extreme cases where death or severe injuries occur the benefits that can accrue to organisations through incremental improvement cannot be ignored.
Communicating the reasons why a risk management program is required may be the first step but the next step is critical to the ongoing success.
Approaching the topic at committee or board level
One of the most important steps is to ensure that the committee or Board members are right behind the risk management strategy. While the process calls for the involvement of people at all levels of the organisation, the process definitely needs to be led from the top.
There are some that might see the process as an imposition or taking energy away from your core mission. The answer to that is that safety is of paramount importance and that with the increased cost of public liability insurance premiums and possibility of claims, any action taken now can save your organisation both money and pain in the future.
Set the subject of risk management as one of the main agenda items to be discussed at the next regular meeting. Beforehand send out information and ideas on how you think the process could evolve to prompt their thoughts and possible concerns.
It is now such an important issue that it demands the attention and intellectual muscle of your board to nominate possible risky behaviours but also to establish how the process will evolve.
Board support is vital because it sends the message through the entire organisation that risk management is important.
Why should the board be interested?
The Board is responsible for the safe and effective running of your organisation. They have a legal and moral responsibility for operating the organisation without risk. At the end of the day any group that is called to answer a claim of negligence may potentially expose those members of the board to the claim. All committee members need to understand that they have an obligation and a duty of care to protect anyone who is involved with the organisation and also anyone who uses or accesses any facilities or programs.
The key questions that need to be raised are:
Getting commitment and support to develop a risk management plan.
Once you have the backing of the board, establishing a risk management sub-committee or appoint one person (preferable not a Board member) to take responsibility for the process and who will be accountable for communicating and adopting a systematic approach to the development of risk management for your organisation. Once you have the commitment you are on the road.
Either way, a senior committee or Board member should also work with the risk management sub committee or risk manager to ensure the process is properly facilitated.
The emphasis from the Board should be to ensure that all sections of the organisation participates in the formulation of risk management strategy.
Part of that will mean explaining to staff, volunteers and stakeholders the reasons why the process is necessary and the benefits for doing it.
The Board should also set a reasonable timetable for the risk management committee to report back on a regular basis so the issue remains alive at your next committee meetings and doesn't get shunted off to the side.
Start by communicating your committee or board's commitment to risk management to all of your staff, members, participants and stakeholders and place it in the context of the process beginning and needing all of their support to make it a success.
To get ideas you can set up:
If you need assistance you can also seek the assistance of insurance or risk management professionals to assist and/or guide you through the process. You may like to ask your local government or peak association for assistance or guidance also.
For some organisations, this can be done in a one-day session. For others it will be a process over weeks or even months. Each organisation is different and each organisation has different priorities. The one thing is you don't want to stretch it out so long that the original energy and enthusiasm for the process wanes and tapers off, leaving you with an inferior end strategy.
Adopt a systematic approach to the management of risk.
Once you have consulted with staff, members, participants and volunteers, compile the list. It might be worth distributing the list to all who participated to see if it prompts other risks that have not be been included.
You have now gone a long way to getting your risk management strategy up and running. For more information on the next stage of the process as contained in the Australian Standard for Risk Management below (AS/NZS 4360:1999), refer to our free Help Sheet on An Introduction to Risk Management.
For further details on implementing a process of risk management along these lines a detailed help sheet on the topic is available and over the coming months resources will expand rapidly together with a series of training seminars so continue to visit
For feedback on this help sheet or for suggestions for future help sheets send an email to: email@example.com.
This material has been prepared with the support of the Victorian Government through the Community Support Fund.
No responsibility can be accepted by the author(s) or the MAV for any known or unknown consequences that may result from reliance on any information provided in this publication.©MAV, Australia, 2002