Risk Management

1. Risk Management A quick guide

2. Introduction • This presentation looks at: • What is risk management • How to identify risks • How to implement an effective risk management policy to increase your business' chances of success and reduce the possibility of failure.

3. What is risk management? • Risk is defined as the probability of an event and its consequences. • Risk management manages these risks using: • processes, • methods • tools • Risk management focuses on: • identifying what could go wrong, • evaluating which risks should be dealt with • implementing strategies to deal with those risks. • Businesses that have identified the risks will be better prepared and have a more cost-effective way of dealing with them.

4. Principles of Risk Management Risk management should: • Create value • Be an integral part of organizational process • Explicitly address uncertainty • Take into account human factors • Be dynamic and responsive to change

5. The risk management process Businesses face many risks, therefore risk management should be a central part of any business' strategic management. Risk management helps you to identify and address the risks facing your business and in doing so increase the likelihood of successfully achieving your businesses objectives.

6. A risk management process involves: • identifying the risks surrounding your business activities • assessing the likelihood of an event occurring • understanding how to respond to these events • putting systems in place to deal with the consequences • monitoring the effectiveness of your risk management approaches and controls

7. As a result, the process of risk management: • improves decision-making, planning and prioritisation • helps you allocate capital and resources more efficiently • significantly improves the probability that you will deliver your business plan on time and to budget

8. Types Of Risk The main categories risk are: Strategic, for example a competitor coming on to the market Compliance, for example responding to the introduction of new health and safety legislation Financial, for example non-payment by a customer or increased interest charges on a business loan Operational, for example the breakdown or theft of key equipment

9. Financial Risks • Financial risks are associated with a business' financial structure and the transactions the business makes. • Involves examining your daily financial operations, especially cashflow. If a business is too dependent on a single customer and they become unable to pay, this could have serious implications. • Also to consider: • Interest Rates • Currency Markets

10. Operational Risks Operational risks are associated with a business‘ operational and administrative procedures. These include: • Recruitment • Supply chain • Transportation • Accounting Controls • IT systems • Regulations • Board Composition IT risk and data protection are increasingly important to business. If hackers break into an IT system, they could steal valuable data and even money . A secure IT system employing encryption will safeguard commercial and customer information

11. Strategic Risks Strategic risks are those risks associated with operating in a particular industry. They include risks arising from: • merger and acquisition activity • changes among customers or in demand • industry changes  • research and development

12. Compliance Risks • Compliance risks are those associated with the need to comply with laws and regulations. • They also apply to the need to act in a manner which investors and customers expect. • For example, by ensuring health and safety legislation is adhered to.

13. Other Risks Other risks include: • Environmental risks, including natural disasters • Employee risk management, such as maintaining sufficient staff numbers and cover, employee safety and up-to-date skills  • Political and economic instability in any foreign markets you export goods to • Health and safety risks • Commercial risks, including the failure of key suppliers or customers

14. Risks at work within BT In all training know matter if it office base, or field based health and safety as well as risk management are a top priority. BT deal with risks by using a set risk specification. The template is a guide to establish which risks require a detailed analysis. It is used to identify the significant risks which need to be assessed, not however to determine whether and what action should be undertaken. Risks are rated fro 1- 49 and the higher the score the ore significant the risk.

15. Union involvement The role of the health and safety representative is independent of management. Representatives are there to represent the interests and concerns of their co-workers and respond on their behalf. They provide valuable insight, skills and resources that help employers and their co-workers. The law sets out what functions representatives have. All representatives, either appointed by trade unions or elected by employees can: • represent the workforce on health and safety generally, or make representations on potential hazards and dangers; • attend training courses; and • have contact with inspectors.

16. Functions of union-appointed health and safety representatives The law makes it clear that they can: • represent employees generally and when you consult them about specific matters that will affect the health, safety and welfare of the employees; • represent employees when Health and Safety Inspectors from HSE or local authorities consult them; • investigate accidents, near misses, and other potential hazards and dangerous occurrences in the workplace; • investigate complaints made by an employee they represent about their health, safety or welfare in the workplace; • present the findings of investigations to you; • inspect the workplace; • with at least one other appointed representative, request in writing that you set up a health and safety committee; and • attend Health and Safety Committee meetings as a representative of your employees.

17. Any Questions?