Identifying Risks and Consequences
Discuss About The Environment And Biodiversity Conservation?
Risk management can be defined as the process, culture and structure for effectively identifying the areas of risk in the workplace. Risk management policies aim to manage effectively the opportunities and the adverse consequences of the operations of organizations. Managing potential risks in the workplace can be achieved by applying appropriate risk management policies and procedures. Reviewing the risk management policies that are prevalent in the workplace, can be of utmost importance in order to mitigate risks. A risk management program is a continuous process as new risks in the workplace are likely to emerge as the old ones are mitigated (Business.qld.gov.au, 2018)
An organization needs to set up a process of monitoring the consequences of the formerly implemented risk management policies and also review the effectiveness of the risk management strategy. Reviewing risk management policies can be vital as the risk which had been formerly identified may become less frequent and the new risks may emerge. Thus the strategy of risk management must be a fluid document and which takes into account the changes in the organization and the risks associated with the changes (McNeil, Frey and Embrechts 2015). Such risk management strategy thus has to be regularly updated.
- Ensuring the that the risk management policy is efficient both in operation and in design
- Improving assessments of new risks
- Analyzing the consequences of risks and taking a not of them
- Identifying new risks that are emerging
A risk management plan is necessary to be made before proceeding with any project to assess and mitigate the risks that might adversely affect the project.The process of risk management includes within its scope :
Identification of the risks associated and the consequences of such risks- It is important to assess and identify the potential types of risks existing in the workplace or the ones that are likely to emerge in the near future (Hopkin, 2017). The risk management plan will also include the types of risks that might affect the project as moves through its cycle in the future.
Profitability- A risk management plan must also include the scope of profitability of implementing risk management procedures. The cost of risk of implementation of the risk management policy is to be assessed against the cost of the consequences of risks that are likely to arise
Impact- Any risk management plan assesses the impact of implementation of risk management procedures on the project. A scale can be used to measure the impacts of the risk management policy on the operations of the organization.
Thus it can be said that the scope of risk management will take into account what risks may arise throughout the stages of the project and identify the necessary steps likely to be taken to mitigate such risks (Wolke 2017). It will also assess whether the risk management policy will be profitable to the project and what will be the impacts of the risk management policy on the project.
- Aim for creating and protecting the value of organizations by implementation of effective risk management policies (www.iso.org 2018).
- Be integrated at the root of the organizational process. Risk management policies must be implemented both at the strategic and operational level.
- Aim to help the process of decision making process of organizations
- Address uncertain risks
- Be implemented from time to time and must be systematic
- Be based on the latest available information
- Be different for different organization
- Involve cultural and human factors
- Involve all stakeholders and must be known to them
- Be flexible and responsive to change
- Aim to provide organizations with scope of continuous improvement .
- Strategic objectives: The senior executive of organizations is responsible for formulating strategy related to risk management (www.iso.org 2018).
- Operational objectives: It is the responsibilities of the managers of agencies to ensure that the operations of such agency are in compliance with the strategic objectives as devised by senior executives
- Line objectives- It is the duty of the line managers to formulate specific strategy plans for achieving the best short terms outcomes for the agency.
- Duty of care- If it is established that any party had a duty to the other and such party breached his duty of care due to which the aggrieved party suffered a loss or injury, such negligent party would be personally liable to pay damages to the aggrieved party.
- Company law- The law related to governance of companies in Australia is Corporations Act 2001. The common risks associated with the operations of companies include breach of duties of directors. If such director is found to be in breach of his duty it has to be reported to the Australian Securities and Investment commission.
- Contract Law- If it is found that either of the parties to a contract has failed to perform the duties as he was bound to do, such party will be in breach of contract terms and will be liable to pay damages for the loss sustained by the innocent for non fulfillment of the contract terms.
- Environmental Law- According to Environment Protection and Biodiversity Conservation Act 1999, if it is found that the operations of any individual or an organization is likely risk the environment of Australia, report of such operations must be sent to the Australian environment minister for assessment.
- Freedom of information- According to the Freedom of Information Act 1982 all individuals have the right to access official documents of the Commonwealth government and its agencies. Thus if any official document is needed for the operations of the agency, such document can be retrieved by following the provisions of requesting information.
- Industrial Relations law- Law related to Industrial Relations in Australia is governed by the Fair Work Act 2009. Thus any risk likely to be faced by the employees of the organization can be resolved in compliance with the provisions of the aforementioned Act.
- Privacy and confidentiality- The Privacy Act 1988 provides the regulations about how to handle personal information of employees by employers. Thus any disputes regarding collection, usage and disclosure of personal information of employees can be mitigated by following the provisions as stated in the act.
- Competition and Consumer Law- The Competition and Consumer Act 2010 (Cth) is a part of the Australian consumer law which aims to safeguard the rights of the consumers in Australia. Thus in case of risks faced by consumers or any consumer related disputes such dispute is to be raised in the Australian Competition and Consumer Commission as provided in the aforementioned act.
- Disability law- The Disability Discrimination Act 1992 aims to prevent any form of discrimination of individuals and prevents unfair treatment of individuals in public life. Thus if complaints of disability discrimination is received, the disability discrimination act is to be referred to assess whether such discrimination is against the provisions of the aforementioned act.
An example of a risk management process is a risk management plan that can mitigate the internal risks of an organization. Internal risks of an organization can be mitigated by assessing the key components that contribute to the internal risks which are:
Corruption- Corruption can be regarded as the most common risk faced by most organizations. Corruption can be defined as the abuse of power of an individual or a group to generate illegal profit (Hopkin 2017).
- Turnover of staff or lack of staff- If only one project leader is responsible for the operations of the team such project leader is to be held accountable for the lack of knowledge spread across the team
- Infrastructure- Whether proper infrastructure is available for the performance of activities is to be assessed as lack of infrastructure can lead to creation of risks
- Cultural conflicts- such cultural conflicts also adversely affects the goals of the organization
- b) It is important to gain support of stake holders because of the reasons enumerated below:
- Ensuring that the values attached to organization and the policies devised by the same are in compliance laws of the state
- As it helps to mitigate risks within the organization
- Gaining support of stakeholders helps in decision making process
The method of stakeholder engagement can be applied to ascertain the support of stakeholders for the process of developing a risk management plan (Leyden et al. 2017)
- d) This particular method is a three step process involving definition of stakeholder, analysis of stakeholder and stakeholder planning.
- a) For communicating the risk management process to the stake holders it is important to:
- Understand the needs and preferences f relevant stakeholders
- Analyzing the risks posed to the stakeholders
- Communicating the risks based on the needs and preferences of stakeholders
- b) For understanding the risks posed to the stakeholders, it is primarily important to understand their needs (Gutteling 2015). The next step involves analyzing the risk in order to assess whether such risk would be in conflict of the stakeholder’s interest. The third step after the analysis is the communication of the risk. Thus these steps are to be taken for communicating risks management process.
- While assessing the harms and risks that are existent or might immerge it is important to seek active participation of stakeholders as stakeholders have different roles in the organization.
- This approach of involving stakeholders in the preparation of the risk management plan is important as stakeholders are likely to have different views about the risks and threats in an organization and might have different opinions to mitigate such risks
Reference List:
Bromiley, P., McShane, M., Nair, A. and Rustambekov, E., 2015. Enterprise risk management: Review, critique, and research directions. Long range planning, 48(4), pp.265-276.
McNeil, A.J., Frey, R. and Embrechts, P., 2015. Quantitative risk management: Concepts, techniques and tools. Princeton university press.
Hopkin, P., 2017. Fundamentals of risk management: understanding, evaluating and implementing effective risk management. Kogan Page Publishers.
Wolke, T., 2017. Risk Management. Walter de Gruyter GmbH & Co KG.
Gutteling, J.M., 2015. Risk communication. John Wiley & Sons, Inc..
Business.qld.gov.au. (2018). Review and update your risk management plan | Business Queensland. [online] Available at: https://www.business.qld.gov.au/running-business/protecting-business/risk-management/preparing-plan/review-update [Accessed 14 Mar. 2018].
31000:2009, I. (2018). ISO 31000:2009 – Risk management — Principles and guidelines. [online] Iso.org. Available at: https://www.iso.org/standard/43170.html [Accessed 14 Mar. 2018].
The Competition and Consumer Act 2010 (Cth)
The Disability Discrimination Act 1992
Privacy Act 1988
Fair Work Act 2009
Freedom of Information Act 1982
Environment Protection and Biodiversity Conservation Act 1999
Corporations Act 2001
Leyden, K.M., Slevin, A., Grey, T., Hynes, M., Frisbaek, F. and Silke, R., 2017. Public and Stakeholder Engagement and the Built Environment: a Review. Current environmental health repo
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