Introduction to Risk Management

Risk management is recognised as an integral part of good management practice. It is an iterative process consisting of steps which, when undertaken in sequence, enable continuous improvement in decision-making. Risk management is the term applied to a logical and systematic method of establishing the context, identifying, analysing, evaluating, treating, monitoring and communicating risks associated with any activity in a way that will enable organisations to minimise loss and maximise opportunities. Risk may be treated variously by avoidance, by transfer, by acting upon causes, and by managing consequences. Any or all of these strategies may be appropriate in particular circumstances...

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Risk Management and the Concept of ALARP

Today, risk management is mandated in OHS matters (eg. NSW OHS Regulation 2001) and required in other areas of business (eg. Australian Stock Exchange's requirements for listing; Institute of Internal Auditors 2000 Guidelines). In the OHS arena the law places very strict obligations on employers to 'ensure safe systems', with defences being centred on foreseeability, preventability and whether it was reasonably practicable to comply. The concept of ALARP - As Low As Reasonably Practicable ' is frequently used in the risk industry as a yardstick for action, and to an extent is embodied in OHS legislation via similar wording. Clearly there is no level at which 'reasonably practicable' can be defined. A helpful starting point is to consider two extremes...

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'All the rules were followed, yet our workmate was killed'

Far too frequently, incidents occur when rules are bypassed. We all tend to take shortcuts - causing management to devote a lot of time and energy into ensuring compliance with rules. 'Failure to follow rules' (or procedures, standards, guidelines) is often listed in reports as the prime cause of a mishap.

But are rules enough? Can management be assured that by following all rules and complying with all standards they will avoid unwanted incidents? Can such a heavy focus on following rules actually induce more risk?...

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Directors' Obligations

Over the last few years, risk management and corporate governance have assumed a much higher profile and are now firmly on the agenda for boards. Individual directors are very clear on their personal obligations. Standards, codes and guidelines tell us what must be achieved - and by when. Risk management ought to be much more than just an annual assessment. Instead it can become an everyday, ongoing activity that adds value - helping to avoid pitfalls and creating opportunity for the enterprise as a whole. How can directors assure themselves that this is happening? What are the questions they can be asking their executive team? How can they probe the implementation of policy and the effectiveness of risk management systems?...

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Creating the Conditions for Sustainable Risk Management

For some years now we have been flooded with information and entreaties about risk management and corporate governance at the highest levels. Executive management is very clear on its obligations. Standards, codes and guidelines tell us what must be achieved - and by when. But what can be learned from high-performing organisations? What practical tips are available?...

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A Case Study in Risk Management

Launceston, 24 Dec 2003: Threat to the Safety of Aircraft. It was a headline event - Christmas Eve travellers, scheduled commercial flight, new and controversial air safety rules, possible midair collision. What happened? What was the background? What can we learn?...

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Dangerous Goods and Hazardous Substances in NSW - Where to Start?

What is the difference between dangerous goods and hazardous substances, and what are the obligations of occupiers of premises, employers and employees?...

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Changes to Dangerous Goods Regulation - What Does this Mean for Employers?

What is changing? The regulation of the storage and handling of dangerous goods (apart from explosives) is now included as part of OH&S Regulation 20011. This places dangerous goods in a risk management framework, consistent with all other types of hazards found in workplaces. This creates new obligations for employers...

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