Risk refers to the uncertainty that surrounds future events and outcomes. Particularly with the current climate of change, it is essential that the Council has a strong Risk Management Policy and a risk aware culture throughout the organisation to ensure that its Key Aims are achieved. Responsibility for Risk Management rests with all Members and Officers of the Council. Members have ultimate responsibility for Risk Management as risks threaten the achievement of policy objectives.
Whilst there is a wide range of risk definitions, the one that has been adopted for the Council’s purpose is that “Risk is an expression of the likelihood and impact of an event with the potential to influence the achievement of an organisation’s objectives.” The range of risks faced is very wide and covers everything from office Health and Safety, to financial, operational, and political through to reputation. Not all risks carry the same value. Risks can be classified as to their impact or the probability of their occurrence.
Risk management is a systematic approach to setting the best course of action for an element of uncertainty by identifying, assessing, understanding, acting on and communicating risk. It involves identifying and controlling risks and these controls fall into two categories. Preventative controls prevent something happening whilst detective controls detect an existing risk. These are further divided into strategic and operational controls.
The Risk Management policy has several objectives and these are clearly laid out in the policy document. This policy is supported by a separate Integrated Risk Management Framework, which identifies the Responsibilities, Approach and Resourcing and includes an active monitoring framework and an implementation plan.
Risk management is an important part of the Authority’s process and forms an integral component of the Comprehensive Performance Assessment. A high performing Council needs to be fully committed to an effective risk management culture and recognise it as helping to ensure achievement of its Key Aims.
Without a proper policy and a strong risk adverse culture, there is the possibility that the Council will fail to recognise the risks that are faced and to take appropriate action to prevent loss or damage.
Rother District Council’s “Risk Management: Policy and Strategic Integrated Framework” is available to download.