sw Risk culture Sally Bennett

Agenda Why is Risk Management important? The Journey to a risk culture. Understanding your risk culture NDS Risk and Controls Framework Key strategies Typical barriers 2

-Captain Smith, Commander of Titanic Risk Management "When anyone asks how I can best describe my experience in nearly 40 years at sea, I merely say, uneventful. Of course there have been winter gales, and storms and fog and the like, but in all my experience, I have never been in any accident of any sort worth speaking about. ...... I never saw a wreck and never have been wrecked, nor was I ever in any predicament that threatened to end in disaster of any sort. You see, I am not very good material for a story" -Captain Smith, Commander of Titanic 3

Treat or Manage the Risk How it fits together Framework Process Provides the framework for implementing a risk management plan Provides the process for implementing a risk management plan Mandate & Commitment Policy Design Framework Organisational context Roles & Responsibilities Resources Communication & Reporting Implement Risk Management Continual Improvement Monitor & review Framework Establish Context Identify Risks Quantify/Assess Risks Treat or Manage the Risk Communicate & consult Monitor & Review

ISO31000 Principles Creates value Integral part of organisational processes Part of decision making Explicity addresses uncertainty Systematic, structured and timely Based on the best available Tailored Takes human and cultural factors into account Transparent and inclusive Dynamic interactive and responsive to change Facilitates continual improvement 5

Risk Culture – 5 Cs Crisis Control Compliance Commitment Culture High Management Activity Supervisory Activity Management Team Activity Leadership Low Crisis Control Compliance Commitment Culture

Value- typical responses Maximises use of resources Improves level of service – client focus Anticipates future problems Improved decision making Improved communications Confidence in future from Community/ shareholders Customers Employees Learning environment Business Excellence 7

How do we get there? Have a vision of the future Understand where you are now Identify the gaps Develop a plan Persistence and patience!! 8

The Hearts and Minds MINDS STRATEGY SYSTEMS STRUCTURE INFORMATION In building an organisational system, there are two parts to the system, those things that define how the system is supposed to work, and the culture which is how the system really works. Management processes drive the first bit, and strong leadership drives the second. From here we are going to break these downt oundertsand how OHS can be managed across any organisation VISION RELATIONSHIPS INFORMATION HEARTS

The Maturity Journey BASIC GOOD BEST Processes designed to keep a minimum level of robustness to the organisation. Processes (typically) driven in an adhoc manner, uncontrolled and used on an as needs basis. Process performance likely to be variable (inconsistent) and depends heavily on the efforts of relatively few people or small groups Lack of formality Meets minimum regulatory requirements Processes designed to ensure robustness and some efficiency to the organisation Some processes are repeatable, possibly with consistent results. Process discipline is beginning to be rigorous, and where it exists it may help to ensure that existing processes are maintained during times of stress. Processes and their outputs are visible to management at defined points, but consistency needs to be improved. Management can effectively control the current situation and adjust and adapt the process to particular situations/ projects. Using quantitative/statistical techniques, process performance is measured and monitored, generally predictable and controllable, and aligned to objectives. 10

Aim 11 Leadership Strategy and Planning Finance People Client and market Focus Innovation, Quality and Improvement Basic Informal governance framework Board understand roles and responsibilities Annual financial reporting and external financial audit, as required by legislation Annual business plan Risk management processes designed Progress against organisational goals measured Quarterly review against annual business plan and outcomes Annual budgeting process Annual financial reporting and auditing Asset register in place Chart of accounts Fundraising conducted on ad-hoc basis Billing and collection process Recruitment process for qualified/skilled/competent people Learning and development strategy Informal performance appraisal system OHS management system includes the identification, management and monitoring of OHS risks Process for staff complaints/feedback User friendly client interfaces and feedback mechanisms Knowledge of product and services offered Marketing/promotional/sales materials provided accurately describe products and services Some consultation with clients, parents and carers with respect to service provision Complaints/feedback documented and measured Information on service and costing provided to client in an accessible format Quality management plan for short-term (1 year outlook) Transparent information and reporting systems Good Formal governance framework in place Board approved delegations policy Board understands roles and responsibilities and provides strategic direction Board takes measures to fill gaps in skills/expertise Audit committee in place Three year strategic plan with clear goals and direction Risk management processes designed and operating within the organisation Evaluation process in place to measure organisational progress against goals and KPI’s measured Quarterly review against annual business plan and outcomes – feeds into medium-term strategic plan review at end of each year Medium-term budgeting process (operational and capital) with 3-5 year outlook Annual financial reporting and auditing with effective internal/external audit function Asset register and facilities management program in place Standard chart of accounts Fundraising conducted on regular basis Billing and collection system Recruitment and retention strategy Formal performance appraisal system Process for staff complaints/feedback incorporates an annual organisational health survey with results reported back to staff User friendly client interfaces and feedback mechanisms with client surveys conducted Good knowledge of product and services offered Annual marketing plan includes provision of clear, easy to read marketing/promotional/sales materials Regular contact with clients, parents and carers with respect to service provision Quality management plan for medium-term (3 year outlook) Transparent information and reporting systems and effective record management system Asset control register in place Best Governance framework reviewed regularly Board approved delegations of authority Board understands roles and responsibilities and provides strategic direction and performance targets Board members have the necessary skills and knowledge to ensure compliance including financial, operational, legal, risk and governance issues Annual financial reporting and external financial audit, as required by legislation. Audit and risk committee in place Five year strategic plan with clear goals and direction Comprehensive risk management framework is operating successfully within the organisation Evaluation process in place to measure organisational progress against goals and KPI’s Monthly reporting and review against annual business plan and outcomes with in-depth variance analysis, including: Variance against financial and capital plans and budgets Variance against strategic plans and objectives. Long-term budgeting process (operational and capital) with 5-10 year outlook Annual financial reporting and auditing with effective internal/external audit function and risk based approach to audit planning Asset register and facilities management program in place which are updated regularly Standard chart of accounts and integrated accounting/financial CRM system Fundraising conducted on regular basis with annual calendar of events planned Recruitment and retention strategy includes career pathways and succession planning (including for board members) Learning and development strategy fosters strong learning culture, including leadership development and mentoring Formal performance management and appraisal system linked to the organisations’ Mission User friendly client interfaces and feedback mechanisms with client surveys conducted which feed continuous quality improvements within the organisation Very good knowledge of product and services offered Medium-term marketing plan includes provision of clear, easy to read marketing/promotional/sales materials Regular contact with clients, parents and carers with respect to service provision and changes to the sector Complaints management system in place Quality management framework Transparent information and reporting systems and integrated records management system Asset management system in place Aim 11

Template concept Element Y/N STEP 1: Risk/ Gap Identification Detailed Element STEP 2: Assess/ Evaluate Set your goals Element Y/N Basic Trust Charter Training Good Best 1 Element Basic Improving Best Governance Strategy Finance Operations STEP 3: Use Risk Improvement Plan Element Gap Controls Actions Who 12

Risk Culture – 5 Cs Crisis Control Compliance Commitment Culture High Management Activity Supervisory Activity Management Team Activity Leadership Low Crisis Control Compliance Commitment Culture