INTEGRATING RISK INTO CORPORATE PLANNING

Transcription

1 INTEGRATING RISK INTO CORPORATE PLANNING

2 Risk Management and Corporate Planning are a bit like the chicken and the egg you can t really have one without the other but which comes first.

3 First Plan then Manage Risk If you don t know where you are going how can you know what the risks or opportunities are.

4 Where you lead, I will follow.

5 Key risks for failing to have a vision and strategic direction Strategic aims and priorities are not properly translated into actions with clear milestones and measures to allow progress to be monitored. Poor connectivity between service planning and resource plans, including budgets. Performance of both the political and managerial leadership in a council is critical to success If councils do not make clear and transparent decisions about priorities and stick to these they will be difficult to achieve

6 Are your projects or activities linked to the corporate strategies? If not why do them? If not won t that put achieving council s vision at risk?

7 The risk of not monitoring performance at a strategic level..

8 The missing link is often management and performance information

9 The International Standards see risk linked to strategic management and performance planning.

10 Councillors and senior management should be asking what is the risk of not achieving the corporate plan? what are the consequences? what are causes? what controls do we have now? what strategies do we need?

11 Is risk management alien to your managers and leaders? Not seen as part of their role? Is it disconnected to the way you do business?

12 What we have to do Identify financial risks and the control measures to manage them. Manage operational risks in the operational plan.

13 But wait there s more.. transparent and effective processes continual improvement excellence in service delivery effective, efficient and economical

14 What can we do.. 1. Look at functionality of software and not be constrained by it 2. Define risk language 3. Look at the quality not the quantity 4. Drop the silo mentality 5. Link risks to strategic objectives 6. Train elected members, directors and managers 7. Continually revise your risk management policy framework

15 TCC What we ve done so far.

16 TCC preparing for the CPM.. Corporate Goal Corporate Outcome Corporate Strategy Division Department Risk Risk Rating Control Rating Economic Sustainability A robust, prosperous economy which provides opportunities for business and investment Engage with regional, state and national stakeholders in the creation of a strong and resilient economy Planning and Development Development Assessment Inappropriate development and growth of the city High Risk Needs Regular Monitoring Economic Sustainability A robust, prosperous economy which provides opportunities for business and investment Engage with regional, state and national stakeholders in the creation of a strong and resilient economy Planning and Development Strategic Planning Failure to plan and facilitate appropriate economic development for the city Moderate Risk Needs Periodic Monitoring Economic Sustainability A robust, prosperous economy which provides opportunities for business and investment Increase the city's profile Community and through marketing Environment initiatives, the delivery of festivals and events and support for other community based activities Community Services Inability to provide the spaces, facilities, activities and events that meet community expectations Significant Risk Needs Periodic Monitoring Economic Sustainability A robust, prosperous economy which provides opportunities for business and investment Increase the city's profile Corporate Services through marketing initiatives, the delivery of festivals and events and support for other community based activities Communications and Customer Relations Damage to council's reputation Low Risk Needs Periodic Monitoring Economic Sustainability A robust, prosperous economy which provides opportunities for business and investment Increase the city's profile Corporate Services through marketing initiatives, the delivery of festivals and events and support for other community based activities Communications and Customer Relations Lack of community awareness to enable compliance with council programs, policies, legislation and regulations Moderate Risk No Major Concern Economic Sustainability A robust, prosperous economy which provides opportunities for business and investment Increase the city's profile Corporate Services through marketing initiatives, the delivery of festivals and events and support for other community based activities Communications and Customer Relations Reduction in sponsorship Low Risk No Major Concern Economic Sustainability A robust, prosperous economy which provides opportunities for business and investment Increase the city's profile through marketing initiatives, the delivery of festivals and events and support for other community based activities Planning and Development Development Governance Inability to provide consistent, relevant and quality customer service Moderate Risk Needs Periodic Monitoring

17 TCC preparing for the CPM..

18 TCC Taking it to the project level Implication Assessment Legal & Have both the legal owner and the Accounting accounting owner of the assets or Ownership expenditure been confirmed? If Yes Advise Financial Services Funding Sources Have all cash and non-cash funding source types been identified and the accounting implications been assessed? Advise Financial Services Funding Obligations Liability Recognition Asset Recognition Taxation Issues Have all reporting and acquittal obligations associated with any funding agreements been identified and their implications? Does the project result in council having any future obligations to third parties or council's future operations? Has the Asset Accounting Policy and Administrative Directive been referred to and applied to the project? Have the GST treatments of the transactions within the project been confirmed? E.g. grants received Advise Financial Services Advise Financial Services Advise Financial Services Advise Financial Services

19 Spot the difference.. Governance Planning and Regulation Inappropriate delegations or delegations not properly exercised Population growth leading to unsustainable natural environmental/infrastructure demand Assets and Finance Limited opportunities to increase rates and user charges, leading to increasing reliance on grants/one off funding Community & Consultation Poor issues management leading to sustained loss of public support for council in media and/or public Workforce relations Skills shortage in professional areas, leading to inability to deliver services

20 What you could end up with.. Better accountability and preparedness for external review A better basis for operational planning and resource management Better identification of opportunities to deliver improved services Quicker and more effective responses to unforeseen events A more systematic and thorough method for decision making

21 Good risk management is forwardlooking. Improve business decisions. Minimise loss and realise opportunities. A powerful tool for managers.

22 The challenge.. To raise the profile of risk management make risk management an everyday part of policy development and service delivery planning and management.

23 The challenge.. To raise the profile of risk management make risk management an everyday part of policy development and service delivery planning and management.

24 Hours after the last familiar sign, the driver kept up a steady pace. "We're lost, aren't we?" said the passenger. "Yes," said the driver, "But we're making good time, don't you think?" -- Anon.