The Institute of Risk Management has published new guidance called Risk governance for charities. The purpose of this free guide is to consider structures that charities can use to make effective risk management decisions.
The guide lists the following benefits that can be derived from good risk management practice:
1. The entire organisation plays a role in risk management resulting in risk being managed at all levels of the organisation.
2. Risk management is transparent with assurances built into processes.
3. Leaders make informed decisions and take timely action.
4. Risk taking is calculated, controlled and monitored.
5. The probability of success is increased and with the organisation more likely to achieve its aims.
6. Opportunities often result from taking calculated risks; these are identified and then maximised to achieve the greatest benefits.
7. The organisation understands its appetite for risk and the level of risk that is acceptable to take.
8. Good risk management is a requirement of SORP (Statement of Recommended Practice) which needs to be detailed in a charities annual report and accounts.
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The guidance considers who needs to be involved in making risk management successful and where the boundaries of accountability and decision making are within third sector organisations.