What it says on the tin

1. What is risk management and why is it important? Earls Court Exhibition Centre 14th January 2009 Dr David Hancock MBA Public Sector Risk Manager of the Year 2008/09

3. What is meant by a Risk? “ The uncertainty of outcome, whether positive or negative threat, of actions and events. It is the combination of likelihood and impact, including perceived importance.” (HM Treasury, The Orange Book, 2004) A statistical certainty?

5. Scoring and Traffic Light Notation L I K 5 E L I 4 H O O 3 D 2 1 1 2 3 4 5 SEVERITY LDA Legal Impact 1 Improvement notice 2 Prohibition notice. 3 Prosecution with fine. 4 Directors charged with Corporate killing, fraud etc.. 5 Directors charged with Corporate killing, fraud etc.. LDA Reputation Impact 1 No press coverage 2 Minor, local reputation damage. 3 Major, local reputation damage. 4 National adverse media coverage. 5 International adverse media coverage Financial 1 £ thousands 2 £ tens of 3 £ hundreds of 4 £ Millions 5 £ tens of millions thousands thousands Descriptor 1 Improbable 2 Unlikely 3 Less likely than not 4 Likely 5 Probable Likelihood Descriptor 1 Minor 2 Moderate 3 Significant 4 Substantial 5 Catastrophic Impact LDA Output Targets 1 Exactly meets targets 2 Significantly meets targets 3 Meets 50% of targets 4 partially meets targets 5 Does not meet targets Health & Safety 1 Negligible injuries 2 Minor injuries 3 Major injuries 4 Single fatality 5 Multiple fatalities Schedule 1 Day 2 Week 3 Month 4 Year 5 Years

6. The Risk Process Set Objectives Monitor the risks Report movement of the risk Identify Threats and Opportunities to Objectives Assess the risks associated with each threat and opportunity ( Inherent ) and map exposure (PxC) Consider actions to manage risk terminate, tolerate, treat, transfer Reassess the risk ( Residual ) and remap (PxC) in light of actions in place

7. Response to risk… the 4 Ts Terminate – Do things differently and thus remove the risk Tolerate – Nothing can be done at a reasonable cost to mitigate the risk or the likelihood and impact are at a reasonable level Treat – Take action to control the risk either by reducing the likelihood of the risk developing or limiting the impact it will have on the project Transfer – Some of the financial risk may be transferable via insurance or contractual arrangements or accepted by third parties

8. Risk and Opportunity

11. Understanding what is meant by project success is crucial

15. What does a successful risk management programme look like?

16. The need for holistic thinking I’m glad the hole isn’t in our end!

17. Corporate Risk register

18. Performance Reporting [including risk]

19. CRR and Audit Plan

21. What is the difference between operational and strategic risk? Operational/ Factors that may effect meeting the short term Technical objectives of the team Financial/ Legal/ Factors that may effect the efficient use and Contractual accountability of funding and the impact of constraints on funding factors that may effect the delivery of statutory/regulatory responsibilities Behavioural/ Cultural and behavioural factors that may effect the Cultural/ performance of the team Organisational Strategic Factors that may effect meeting the medium to long term objectives of the team

22. A New Risk Management Model?