Seminar brought to you by Risk Appetite vs Risk Capacity
Dec 21, 2015
Definitions
• Risk the effect of uncertainty on objectives (AS/NZS ISO 31000:2009)
• Risk Management the coordinated activities to direct and control an organisation with regard to risk
• Risk Management policy the statement of the overall intentions and direction of an organisation related to risk management
• Risk Attitude an organisation's approach to assess and eventually pursue, retain, take or turn away from risk
Definitions
• Risk Appetite the amount of exposure the organisation is willing to accept/retain to meet its mission, goals or objectives
• Risk Capacity the amount of risk the organisation can actually accept
• Risk Tolerance the amount of risk the organisation is prepared to carry after risk treatments have been applied
Types of Risk
• Financial Turnover, reserves, financing
• Human Key personnel, theft & fraud, activities
• Strategic Wrong guidance, poor strategy, no strategy
• Operational Technological, equipment, premises
Types of Risk
• Reputational Governance, management, culture
• Environmental Fire, flood, earthquake, pollution, waste, detrimental impact
• Crisis in any of the above Emergency response/action ( Strategic Planning) and Business Continuity to Recovery
Risk Management Process
• IdentifyAll risks to the business
• AssessAssess the likelihood of occurrence and the impact
• Evaluate/PrioritiseRank the risks on the basis of their risk rating
• ControlEliminate, Reduce, Share/Transfer or Accept
• MonitorMeasure the outcomes and adjust accordingly
Example Club Risk Review
Risk LikelihoodImpact to business
Risk Ranking Control
Actioned by Resources needed
Revised Risk
Ranking
CEO Departure
Medium Severe HighSuccession planning and talent identification
CEO &
Chair
Skills matrix, resumes, training
Low
Reduced Cash Flow
High Severe Very HighReview market and marketing
CEO & staffSWOT, Market review, Demographics and expenditure review
Medium
Bistro Fire Low High Medium
Sprinkler System, Crisis Management Plan, Staff Training, Alternate facility review/ supply agreement
CEO & F&B Manager/
Contractor
Fire equipment and training, SOPs, negotiation with alternate facility or supplier
Low
Armed Robbery
Low Medium Low
Armed Robbery Prevention training, Standard Procedures, car park lighting, timer safe, emergency alarm button
CEO & staff
Training, car park lighting, timer safe, emergency alarm button
Low
Strategies
• Crisis Management Plan– What are the triggers?– What are the actions and who is responsible?– Who should be notified?
• Business Continuity Plan– How will the organisation continue to trade?– What happens with the staff?– What happens to creditors and debtors?– What insurances need to be in place?– How long will it take to recover fully?
Case Studies
• Key Personnel
– Sundance
• Financial
– Centro
• Environmental
– Ardlethan Bowling Club
– Prime7 video
Further information and assistance
ClubsNSW Member Enquiries Centre
1300 730 001
ClubsNSW Learning & Development Team
9268 3000