Risk

Risks are occurrences in the life cycle of an entity that can be measured. They can be disastrous in their consequences. Risk management requires long term thinking; it requires a prevention approach rather than reaction response.

The plan must ask: “What can go wrong, and can I insure?
                           “What can go wrong – court cases

Risks that can be planned for include:

  • Fraud – Editor: Hugh Thomas, chartered accountant
  • Environmental Reporting – ETS – Editor: Advitech
  • Global financial turmoil (creates opportunities as well as threats).
  • Legal claims – Law reports: AR Conolly
  • Product liability claims.
  • Professional negligence.
  • Workers injury and death of key personnel – Law reports: Turner Freeman
  • IT failure and computer malfunction.
  • Fire.
  • Economic changes to supply chains and currency fluctuations.

Risks that are difficult to plan for:

  • Economic meltdown of world markets or supply of essentials.
  • War.
  • Civil unrest.
  • Environmental disasters such as tidal waves, floods, earthquakes, and lightning strikes.
Risk Management - The Business Plan