A risk-based approach to regulatory matters


Risk definitions:

These definitions are from the Australian/New Zealand Standard, Risk Management.

Risk
The chance of something happening that will have an impact on objectives. A risk is often specified in terms of an event or circumstance and the consequences that may flow from it. Risk is measured in terms of a combination of the consequences of an event and its likelihood. Risk may have a positive or negative impact.

Risk management process
The systematic application of management policies, procedures and practices to the tasks of communicating, establishing the context, identifying, analyzing, evaluating, treating, monitoring and reviewing risk.

Risk management framework
The set of elements of an organization's management system concerned with managing risk. Management system elements can include strategic planning, decision making, and other strategies, processes and practices for dealing with risk. The culture of an organization [and the jurisdiction being regulated] is reflected in its risk management system.

Risk analysis
The systematic process to understand the nature of and to deduce the level of risk. Risk analysis provides the basis for risk evaluation and decisions about risk treatment.

Risk assessment
The overall process of risk identification, risk analysis and risk evaluation.


Risk management as a framework for regulators

Risk management is particularly relevant to regulators. Where there is potential for harm and citizens don't have the knowledge or other resources to protect themselves, governments step in and create the rules of engagement.

You could, in fact, say risk management is the core business of regulation - reducing harm and increasing quality by implementing standards, registering participants, educating the public and dealing with issues.

When the goals are broad - like public safety - and there are challenges on every side, a risk framework helps you develop a workable strategy for achieving your regulatory objectives by - setting priorities, allocating scarce resources, and employing effective tools and tactics.

The cornerstone of our work is assisting you to integrate risk awareness and management into all aspects of your regulatory business.

IN THE AREA OF COMPLIANCE
Encouraging compliance (and/or encouraging excellence that is on the other side of compliance) requires a powerful positive strategy.

RSG's approach uses risk management methods that recognize the importance of using strategies with complementary positive and negative impacts. We bring focus, passion, rigorous thinking and experience to help regulators develop and execute positive strategies.

IN THE AREA OF ENFORCEMENT
RSG's risk assessment methods help you focus limited investigation resources on the risks that are most intolerable. They allow enforcement to play a strong role in informing the development of policy, standards and regulations.

IN THE AREA OF STAKEHOLDER CONSULTATIONS
Consultation establishes important information about how your stakeholders view risk. Stakeholder experience and expertise will often improve the understanding of the threats that you manage. Taking account of a diversity of perceptions broadens risk assessment making it more successful. This review is intrinsic to the process of risk management as it helps "establish the context" within which the risk management is to take place.

RSG provides the structure and tools to support continual stakeholder conversations. Regulators need to have continual input that matches the evolution of risk in their jurisdiction.

IN THE AREA OF TRUST AND REPUTATION
Risk management is most successful when regulatory authorities and their stakeholders trust that they can count on each other. When you’re the regulator, your reputation not only precedes you but can also determine how successful you are in achieving your objectives. We help you assess your current situation and develop strategies for building trust and improving your reputation.