Risk Management

In a fast-evolving world, managing risks can be very challenging. This is why companies require efficient risk management that can help them to identify threats and opportunities and allow their businesses to thrive.

Risk management is the identification and prioritisation of risks. It involves the application of resources to reduce, check and control the probability and exposure of adverse events on the functioning of a company and maximising the awareness of opportunities. The objective of risk management is to ensure that indecision does not repel the efforts of your business goals.

There can be multiple sources for risks to originate. For example, threats from project failures, accidents, legal liabilities, volatility in financial markets, credit risks, unpredictable events, and so on. Depending on the source of risk, the definitions and goals of risk management can vary in the context of public health and safety, actuarial assessments, financial portfolios, and many more.

Recognising Risk

Since every project is different, the priorities of risks can vary accordingly. It is also important to remember that despite the best-laid plans, it is still possible that risk may not be eliminated but can reach a level where its impact is negligible. For that, the risk matrix needs to be revisited and updated regularly.

• Identify

Before any assessments can begin, a first good step can be to list down every potential risk that a project may be exposed to. Even if there is a very slight chance of an event occurring, it should still form part of the risk matrix and not be ignored. Changes due to unforeseen conditions, may not always be possible to mitigate fully, yet, proper precautions can minimise their impact to a considerable level.

• Measure the Likelihood

Each risk identified in the above stage must be given a ranking based on its chances of occurring. It could be on a scale of 1 to 5, with 1 being unlikely and 5 being likely. Alternatively, it could be based on a percentage.

• Assess Impact

Using the same guidelines established above, in this stage, you can rank the impact of the different risks on the company's functioning. For example, a lost time accident could prove to be highly risky if there's not much margin in a project, falling in a ranking of 5. Whereas, for a project that can accommodate time margins, a lost time accident may not cause too many schedule disruptions.

• Find the Overall Calculated Risk

Based on the scale to measure the impact and likelihood of a risk, the overall risk associated with a certain event can be calculated. This can be followed by assigning priorities to the risks in terms of low, medium and high impact levels. This can help the management to tend to risks which are labeled high priority first and then take care of lesser risky events.

We can offer the following services:

• We can help you ascertain the risk profile of your company by performing a high-level assessment based on best practice risk management standards.
• We can ensure your company has an effective risk framework and provide opinions on what needs to be done to achieve so.
• Undertaking a robust analysis of risk information and resources on critical areas.
• Developing an embedded early warning system that can provide timely awareness of material areas of risk and changes in control effectiveness.
• Helping you design a system that can ensure compliance with relevant laws and regulations.
• Ensuring that the interests of the stakeholders are protected at all times by:
  • Overseeing the integrity of all the financial information and financial records provided to the public or any governmental body by the company.
  • Overseeing the qualifications of the company’s independent auditor.
  • Overseeing the internal control system of the company regarding accounting, finance, legal compliance, risk management and ethics that the board and the management have established.
  • Overseeing the auditing, accounting and financial reporting processes of the company in general.
• Assisting your company to formulate a framework around emerging risks.
• Helping you to establish a reporting procedure and operational risk incident process.

You can get in touch with us today if you need our Risk Management Services. We look forward to hearing from you.