Risk Management For Charities
The Code of Governance for Charities sends an unambiguous message to all concerned within the sector that “Good governance in charities is fundamental to their success.”
This overarching statement is then clearly supported with a message that should resound with Trustees and Executive alike that right leadership structures are key to good governance; with an expectation that skilled and capable trustees will help a charity achieve its vision and objectives and therefore be best placed to attract resources. It is also noteworthy that good governance expectations extend to ensuring compliance with relevant legislation and regulation.
The Code promotes actively managing risks with the Board of Trustees retaining overall responsibility for risk management and decisions regarding its risk appetite.
To achieve this successfully it is the responsibility of each Trustee to ensure that they have a firm grasp of the significant risks which the Charity faces, particularly as the Board is required to describe the charity’s approach to risk in its annual report and confirm that it is in line with regulatory requirements.
Trustees therefore must expect to contribute towards the identification of risks that the Charity faces and expect routine assurance that at a strategic and operational level, residual risk is being managed effectively; where it is above risk appetite they must be provided with a timely assessment of the potential impact and the action s being taken to deal with the situation.
The use of RiskMate automated software provides an at a glance oversight of the risk environment facing the Charity allowing Trustees to maintain a watch over key issues remotely; this is important as it allows effective preparation regarding key issues that the Charity faces outside and before routine Board or Audit and Risk Committee meetings.
From an Executive point of view, the software assists effectively embedding a risk management culture throughout the organisation by:
- Devolving risk identification, grading, review and management to risk owners,
- Providing an overview of the risk environment to the Corporate Risk Manager,
- Acting as a real time report at Corporate or Operational meetings for the consideration and review of risk, and
- Removing the need to prepare spreadsheet-based reports to support agenda’s through on-line access to a dashboard showing the live risk environment highlighting significant risks, trends, movements and incomplete risk management action.
The system supports and ensures that the board regularly reviews the charity’s specific significant risks as well as the controls to mitigate and manage these risks appropriately. As such, it should ensure that a focus is provided on what matters most, and whilst this may be financial or have an ultimate financial consequence, it should also draw attention to those areas impacting on achievement of the Charities aims, such as:
- Risks relating to safeguarding in respect of children or vulnerable adults,
- Activity levels, contract management and the quality of services,
- People related risks in relation to employees, and
- Estate Management including Health & Safety
Operating in real-time on cloud-based software, RiskMate will help ensure that you maintain control as well as looking ahead to ensure that you are as prepared as possible for what your Charity may face.