RISK MANAGEMENT CYCLE

Strategy − Risk Mgt. Why and What

Risk Attitude
Policy − How Risk Mgt. operates
Appetite − Risk seeking/averse
Exposure − Open/Covered
Tolerance − Limits

Recognition − Identification – context and data

Risk Awareness Analysis − Opportunity/Threat –
+/- Upside/Downside
− Implications e.g.
- Governance - compliance
(INTER) - Management
DEPENDENCIES - Quality
E and - Reputation
SUSTAINABILITY – - Resources
M PARTNERS - Finance
Global Consequences Evaluation − Significance (impact)
B − Likelihood (probability)
− Salience/Proximity
E Register − “Traffic Lights” (status)
D (Gross/Inherent Risk)
(Systemic risk)
D Risk Management Allocation − Person with responsibility

I CONTINGENCY
Managing − Terminate – Avoid or Eliminate
(The four Ts) − Transfer – Share, insure
N PLANNING − Tolerate – Accept the risk
− Treat – Control measures or
G BUSINESS
Monitoring − Periodic
Contingency Plans
CONTINUITY
PLANNING (BCP) − Early warning - Key Risk
Indicators
− State - static, rising, declining
DISASTER Residual Risk − Est. of Net Risk
RECOVERY
Risk Extent − Est. of Cumulative Risk
− (Exposure)
Risk Reporting Dynamic Risk Register
Learning from experience
(Sustainability Accounting and Corporate
Social Responsibility [CSR])

Approach to Risk Tolerance Limits

Risk Management
Framework of arrangements
Review
Adequacy of formal and informal control
system Self-assessment
Assurance
Risk Attitude