Risk Maturity Model

Safety objectives cannot be fully realised through rule enforcement alone After the dramatic improvements of H&S using systematic procedural techniques, the quest for zero incident rates has remained illusive. Continuously tightening work place discipline and rigour can prove counter productive if it leads to a ‘them and us’ mentality characterised by mistrust, resentment and disaffection. Trust and mutual respect are only achieved through proper consideration of the human factor in the risk equation. Many different aspects of personality are related to risk taking; it is not a simple scale between ultra cautiousness and uncontrolled recklessness. To enrich organisational risk culture […]

Pedlam Risk – A Quick Update on Legal issues

Pedlam Risk – a legal risk management consultancy – have kindly allowed us to feature their update on legal issues which may affect UK companies. For further information, head to www.pedlamrisk.com.   Q1. What is IPR – do we have any and do we need to bother about it? A: ‘Intellectual Property Rights’ are valuable assets of a business. They are abstract and hard to understand. Essentially they comprise: trademarks, patents, copyright, confidential know-how and design rights. Many exist automatically – such as copyright and know-how; others need registration – such as trademarks, patents and design rights. It is worth reviewing […]

‘Three Lines of Defence’: A Dangerous Delusion

By Anthony Fitzsimmons A ‘Three lines of Defence’ risk management model sounds reassuring, but it contains a flaw.   The model was implicitly endorsed by the UK’s now defunct Financial Services Authority in 2003 and is still characterised as “sound operational risk governance” by the Basel Committee on Banking Supervision, failed to prevent the recent financial sector crisis. ‘Three lines of defence’, ubiquitous in financial services and widespread elsewhere, actually has four layers.  Line managers deal with risks as they take them. Centralised teams monitor and report on risk to the CEO’s team and to the board. Internal and external auditors should bring an independent […]

The Mosaic of Risk Culture

“Risk Culture”, with its implications of a deeply entrenched set of influential and effective risk attitudes, has an obvious appeal as a vehicle for risk-management, potentially opening doors to new possibilities and solutions. The practical difficulties associated with this approach arise from uncertainties concerning the definition of culture and, as a consequence, uncertainties about its mechanisms, its constituent parts, or its processes. When it comes to action, intervention or influence, it is difficult to know where the levers are, which to pull or how to get to grips with culture. This dilemma was summed up by the late Professor Peter […]

Risk Type, Gender and the Benefits of Balance

Research, it is has been claimed, shows little difference in personality between genders. This has been disputed recently by others and our own research into personality based Risk Type shows that, although both genders include significant numbers of all the Risk Types, there are quite dramatic differences in the incidents of Risk Type for males and females (diagram 1). Amongst females there is a greater proportion of the more cautious Risk Types, and amongst males, a greater proportion of more adventurous and reckless Risk Types. But what is really interesting, is that if you combine male and female data, the […]

The Auditor: Risky Business

  Auditing is risky business. The choice of becoming an auditor, choosing your field of expertise, gaining an understanding of the standards, and applying to technical area all rely on a professional’s competence. What underlies this competence is the confidence to complete the task. This confidence is achieved through the ability to resolve the risk inherent in the process. Let’s talk risk.