Business risk management

BUSINESS RISK MANAGEMENT:

Companies are very different and do provide different products and services. What is interesting that management practices including risk management are universal and can be applied for any size and any type of company. It is vital that company CEO invest at least small amount of his\her time for business risk management by showing example and importance of such risk management in the company. Other vital practice to empower/delegate critical roles to act and take leaderhips in risk management. You can apply universal Risk management steps/ practices and will increase your business probability to succeed. Obviuosly some kind of Risk register should be used to store key business risks and most important information how those risks are managed. Other literature/sources highlight the importance to differenciate business risks by types e.g. : 1) Financial/Economical 2) Operational 3) Reputational 4 ) Compliance 5) Security/Fraud 6 ) Strategic. Obviuosly it is Risk brakedown structure practice that helps to have clear structure and orchestration of risk management.

RISK management FRAMEWORKS/MODEL to consider :

No.	NAME	Description
1	ISO 31000	SO 31000 is an international standard for risk management. It provides a systematic and structured approach to identify, assess, treat, and monitor risks. The ISO 31000 framework emphasizes the importance of context, stakeholder engagement, risk assessment methodologies, and risk treatment options.
2	Axelos, M_o_R (Management of Risk)	Is a widely recognized framework for risk management, particularly in the context of projects, programs, and portfolios.The M_o_R framework provides guidance on establishing risk management policies, processes, and strategies. It focuses on principles and concepts that help organizations effectively identify, assess, and control risks. The model emphasizes integrating risk management into decision-making and promoting a proactive and structured approach to managing risks.The M_o_R framework includes several key elements, such as risk governance, risk identification, risk assessment and analysis, risk response planning, risk monitoring and reporting, and embedding risk management into organizational culture and practices.
3	COSO ERM Framework	The COSO (Committee of Sponsoring Organizations of the Treadway Commission) Enterprise Risk Management (ERM) framework is widely recognized and provides a comprehensive approach to risk management. It focuses on integrating risk management with an organization's strategic objectives, internal environment, risk appetite, and risk response.
4	PMI-RMP	The Project Management Institute's Risk Management Professional (PMI-RMP) certification framework is specifically designed for project risk management. It encompasses the processes, tools, and techniques for identifying, analyzing, and responding to risks within project environments. The PMI-RMP framework aligns with the PMBOK (Project Management Body of Knowledge) Guide.
6	FAIR	FAIR (Factor Analysis of Information Risk) is a quantitative risk assessment model that focuses on evaluating and quantifying information and cybersecurity risks. It provides a structured methodology to assess the frequency and magnitude of potential loss events and determine the financial impact of risks.
7	NIST Risk Management Framework	The NIST (National Institute of Standards and Technology) Risk Management Framework is commonly used in the context of cybersecurity and information systems. It provides a structured approach for identifying, assessing, and responding to risks, as well as continuous monitoring and risk mitigation activities.
8	Five Whys	The Five Whys is not a model, but simple & yet effective risk identification practice that can help identify root causes of risks by asking "why" repeatedly. It encourages digging deeper to understand the underlying reasons behind risks and facilitates the development of targeted risk mitigation strategies.
9	OCTAVE	OCTAVE (Operationally Critical Threat, Asset, and Vulnerability Evaluation) is a risk assessment and management method designed specifically for information security risks. It focuses on understanding an organization's operational processes, critical assets, and potential threats to develop risk mitigation strategies.
10	Consultancy - Deloitte Risk Intelligence	Deloitte offers a comprehensive risk management framework that focuses on identifying, assessing, and mitigating risks across the enterprise. Their approach emphasizes integrating risk management with business strategy, enhancing risk awareness, and establishing effective risk governance and reporting mechanisms.
11	Consultancy - KPMG Risk and Compliance Framework	KPMG provides a risk and compliance framework that helps organizations proactively manage risks, ensure regulatory compliance, and strengthen governance practices. Their model encompasses risk identification, assessment, monitoring, and response activities tailored to different industries and regulatory environments.
12	Consultancy - PwC Risk Assurance	PwC offers a risk assurance framework that assists organizations in identifying, prioritizing, and managing risks across various business functions. Their approach emphasizes risk mitigation, internal controls, and leveraging data analytics to enhance risk assessment and monitoring capabilities.
13	Consultancy - EY Risk Navigator	EY's Risk Navigator is a risk management framework designed to address the evolving risk landscape. It provides a structured methodology for risk identification, quantification, prioritization, and response planning. The model aims to enhance risk visibility, decision-making, and resilience.
14	Consultancy - Protiviti Risk and Compliance Framework	Protiviti offers a risk and compliance framework that focuses on establishing a risk management culture and integrating risk management into core business processes. Their model helps organizations identify and address risks related to strategy, operations, technology, and compliance.

It's important to note that Consultancy models and the availability and suitability of these consultancy models may vary depending on the geographic location and industry. Organizations should assess and select a business-driven risk management model that aligns with their specific needs, industry requirements, and risk management objectives. Customization and adaptation of these models to fit the organization's unique circumstances are often necessary for successful implementation.

SUGGESTED SUCCESS FACTORS for good BUSINESS RISK MANAGEMENT:

No.	Factor	Description
1	CEO	Company CEO should invest on regular basis some time to review company risks and ask what are the results of taken risk response actions from Risk owners
2	Risk leader	Appointed person in the company who leads business risk management - facilitate that Risk management steps procedure flows and support CEO to organize risk management.
3	Risk owners	It is recommended to appoint each company department manager as risk owner who is responsible for his/her department risk management. Good indicator - to have 1-5 risks allocated to single Risk owner. Risk owner should not delegate single risk management overall responsability to subordinates. Subordinates should take only some risk action responsility in RISK ACTIONEE role.
4	Risk register	Obviously Risk register is needed to store all company key risks with taken decisions and actions planned and delived on company business risk management.
5	Regular risk review	It is very good practice if company CEO invest/ dedicate some time in company management regular meetings to review key risks and follow-up actions agreed before with Risk owners
6	Action and risk reminders	It is good practice if Risk leader distribute on regular basis e.g. once a month status of existing company business risks and what actions delayed or still awaiting for Risk owners. In the communication flow CEO should be added at least carbon copy.

Other Quality criteria for good Business Risk management:

Status is used in risk register that allow to review risk management based on risk management agreed procedure

Risks have id & link to company department and/or company product or company service are available

Risk register is in safe place where access is controlled according to your or your company IT policy or needs

EXAMPLE from T RISK REGISTER🔺:

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• T Risk Register & DOWNLOAD here