What is risk management?
Risk management had its beginnings in the insurance industry and has moved across to most industries. Risks are uncertain future events which could affect an organisation’s strategic, operational, safety and financial goals.
Risk Management Standard AS/NZ 4360 is the global standard that provides a cross industry consensus on the elements of the risk management process. This standard defines risk as ‘the chance of something happening that will have an impact upon objectives. Risk is measured in terms of consequences and likelihood’.
Assets at risk can include:
- Financial assets such as cash and investments
- Physical assets such as land, buildings and equipment
- Human assets including knowledge and skills
- Intangible assets such as reputation and information
Risk management is a component of a systematic approach to operational management and, as such, is a quality assurance mechanism that should be integrated into RTO processes where appropriate.
A widespread outbreak of H1N1 virus (Swine flu) is a risk event for an RTO. Therefore, this risk instrument may be of assistance in planning for the possibility.
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