Principles of Risk Management PDF

Principles of Risk Management Terminologies Risk-Based Thinking Risk Proactive - Effect on uncertainty - Focuses on anticipating objecti...

Principles of Risk Management Terminologies Risk-Based Thinking Risk Proactive - Effect on uncertainty - Focuses on anticipating objectives potential risks Risk management Holistic - Coordinated activities to - Considers the entire direct and control an organization & organization with regard Interconnected system to risk Opportunity-focused Stakeholder (interested parties) - Looks into potential - Person / organization that benefits in a risk/certain can affect, be affected by, situation or perceive themselves by a decision or activity Decision Driven - Helps to make a thorough Risk Source decision - Element which alone or in combination has the KINDS OF ORGANIZATIONS potential to give rise to risk (origin / cause) 1. External (Controlled) 2. Internal Factors (Limited Event Control) - Occurrence or change of a particular set of Managing Risk circumstances It is interactive (Repeatedly) and assists organizations in setting Likelihood strategy, objectives, and decision - Chance of something making happening Part of a governance & leadership Control Part of all activities associated - Measure that maintains & within an organization and modifies risk interaction with stakeholders Principle, Framework, Process  Principles E. Dynamic The purpose of Risk Management - Risk management is the creation and protection of anticipates, detects, value. acknowledges, and responds to those changes Improves performance, and events in an encourages innovation, and appropriate and timely supports the achievement of manner objectives. F. Best available information A. Integrated - The inputs on risk - Risk management is an management are history integral part of all and past mistakes organizational activities G. Human & Control factors B. Structured & Comprehensive - Human behavior and - This contributes to culture significantly consistent and influence all aspects of comparable results risk management C. Customized H. Continual Improvement - The risk management - Risk management is framework and process continually improved are customized and through learning and proportionate to the experience organization’s external & internal content related to its objectives D. Inclusive - Appropriate & Timely involvement of stakeholders enables their knowledge, views, and perceptions to be considered.  Framework of Risk Management External context The purpose is to assist the organization in integrating risk management into significant activities and functions. Leadership and Commitment Top management and oversight bodies, where applicable, should ensure that risk management is Internal context integrated into all organizational activities Top Management Accountable for managing risk Oversight bodies Accountable for overseeing risk management Articulating risk management FRAMEWORK commitment - Top management & 1. Integrating risk management oversight bodies should - Relies on an understanding of demonstrate and organizational structures and articulate their continual context commitment to risk - Structures differ depending on management through purpose, goals, and complexity policy, statement, forms 2. Design Assigning organizational roles, authorities, responsibilities, and Understanding the organization accountabilities and its context - Top management & - The organization should oversight bodies should examine and understand ensure that the its external and internal authorities, context responsibilities, and  accountabilities are assigned to 4. Evaluation organizations Periodically measure risk management framework Allocating resources performance against its purpose, 1. People, skills, experience, and implementation, plans, competence indicators, and behavior 2. Organization’s processes, methods, and tools to be used for 5. Improvement managing risk 3. Documented processes and Adapting procedures - Organization should 4. Information and knowledge continually monitor and management systems adapter the risk 5. Professional development and management framework training needs to address external & internal changes Establishing communication and consultation Continually improving - Organization should established - Organization should an approved approach to continually improve the communication and consultation suitability, adequacy, and in order to support the effectiveness of the framework and facilitate framework and the way effective application of risk the process is integrated management 3. Implementation The organization should implement the risk management framework by: Developing an appropriate plan How types of decisions are made Across the organization & by who Modifying the applicable decision making processes Ensure that organization arrangements for managing risks are understood and practiced  Popular Risk Management OCTAVE (Operationally Critical Frameworks Threat Analysis and Response) - Collaborative approach NST Risk Management that involves a team of Framework (RMF) stakeholders from - By the National Institute departments of Standards and Technology - Used in the United States government & private sector COSO Enterprise Risk Management (ERM) - Provides a structured approach to managing enterprise-wide risks ISO 31000 - International standard that offers framework for risk management - Applicable to organizations of all sizes and sectors FAIR (Factor Analysis of Information Risk) - Quantitative risk assessment methodology that calculates the financial impact of information security risks  Risk Management Process Defining risk criteria - Specify the amount and type of The risk management process should be risk that it may or may not take, an integral part of management and relative to objectives decision making and integrated into the - Define criteria to evaluate the structure, operations and processes of significance of the risk and to the organization. support decision making Process 3. Risk Assessment - It is the overall process of risk 1. Communication and identification, analysis, and Consultation evaluation - The purpose is to assist relevant - Should be conducted stakeholders in understanding systematically, iteratively, and risk, the basis on which decisions collaboratively, drawing on the are made and the reasons why knowledge and news of particular actions are needed. stakeholders 2. Scope, context, and criteria Risk Identification - The purpose is to customize the - Purpose is to find, recognize, risk management process, describe risks that might help or enabling effective risk prevent an organization assessment and appropriate risk achieving its objectives treatment Risk Analysis Defining the scope - The purpose is to comprehend - The organization should define the nature of risk and its the scope of its risk management characteristics activities. - Involves a detailed consideration of uncertainties, sources etc. External and internal context - The external and internal context Risk Evaluation is the environment in which the - The purpose is to support organization seeks to define and decisions achieve its objectives. - Comparing the results of the risk analysis with the established risk criteria to determine where additional action is required  and reported through appropriate mechanisms 4. Risk Treatment - Purpose is to select and Factors to consider for reporting, but implement options for addressing are not limited to: risk 1. Differing stakeholders, and their Selection of risk treatment specific information needs and options requirements - Involves balancing potential 2. Cost, frequency, timeliness of beliefs derived in relation to the reporting achievement of the objectives 3. Method of reporting against cost, effort, or 4. Relevance of information to disadvantages of implementation organizational objectives and decision making Risk treatment options are not necessarily mutually exclusive or appropriate in all circumstances. Preparing and implementing risk treatment plans - Purpose is to specify how the chosen treatment options will be implemented, so that arrangements are understood by those involved - Clearly identify the order in which risk treatment should be implemented 5. Monitoring and Review - The purpose is to assure and improve the quality and effectiveness of process design, implementation and outcomes 6. Recording and Reporting - The risk man processes and its outcomes should be documented  is concerned with preventing Occupational Health and Safety harm from any incidental Practices in Tourism and Hospitality hazards arising in the workplace Industry Three main objectives Element 1: Occupational Health and Safety 1. Maintenance and promotion of workers’ health and working Occupational Safety and Health (OSH) capacity health and safety, occupational 2. Improvement of working health and safety (OHS), environment and work to occupational health or safety become conducive to safety and Multidisciplinary field concerned health with the safety, health, and 3. Development of work welfare of people at work organizations and working As defined by the World Health cultures in a direction which Organization (WHO) supports health and safety at “Occupational health deals with work and a positive social all aspects of health and safety in climate and smooth operation the workplace and has a strong and may enhance productivity of focus in primary prevention of the undertakings hazards Element 2. OHS Law in the Philippines Health Defined as “a state of complete RA 11058 physical, mental, and social An act of strengthening well-being not merely the Compliance with OHS standards absence of disease or infirmity” and providing penalties for violations thereof and its IRR Occupational Health (D.0 198-18) Multidisciplinary field of healthcare concerned with Coverage enabling an individual to 1. All Private establishments undertake their occupation in the Where work is being way that causes least harm to undertaken including their health establishments located It contrasts with promotion of inside special economic health and safety at work, which zones and other investment promotion agencies  4. To report accidents and 2. Utilities engaged in air, sea and dangerous occurrences to land transportation DOLE-ROs and other government 3. Public Sector (Exemption) agencies in the most convenient National government way agencies, government 5. Workers shall be free from owned and controlled retaliation for reporting any corporations with original accident charters, government financial institutions, state Workplace Classification based on universities, local risk government units Low Risk Workplace Refers to those with less Duties and Rights exposure to safety and health Employer’s duties - Provide a safe and hazards healthy workplace through the ff: Low level of danger With no or less probability to Capacity building of all workers cause an accident, harm, injury, including mandatory trainings or illness Provision of information on OHS Use of devices / equipment with Medium Risk Workplace approved industry standards Refers to those having moderate Compliance with all the exposure to safety and health requirements of the OSH hazards Standards With probability of an accident, Provide appropriate DOLE tested injury, or illness if no preventive and approved PPEs FREE of or control measures in place charge to the workers High Risk Workplace Worker’s Rights Refers to those wherein presence 1. To know the different types of of hazards affects not only the hazards in the workplace workers but persons outside the 2. Be provided with training, establishment education, and orientation With high level of exposure to 3. To refuse unsafe work without safety and health hazards threat or reprisal from the Probability of major accident is employer in cases of imminent likely to occur danger. Affected workers may be temporarily assigned to other work areas  3. Nurses Occupational Safety and Health (OSH) 4. OSH Personnel Complement Programs 1. Covered workplace through the Number and type of OSH personnel are Health and Safety Committee based on the number of employees and (HSC), shall develop and the correct determination by the Safety implement a suitable OSH Officer of his/her workplace Program following the classification DOLE-prescribed program 2. OSH Program shall be submitted Safety and Health training and considered approved upon requirements stamped-received by concerned 1. All OSH personnel shall undergo DOLE-Regional Office or Field the prescribed mandatory office. Pre-approved program training from DOLE-accredited shall be validated during safety training organizations or inspection and may be modified its recognized training by DOLE as necessary, based on institutions existing laws, rules, and 2. All workers shall undergo the regulations mandatory 8-hour OSH seminar 3. The HSC shall review and as prescribed by DOLE. This evaluate the OSH Program at training may be conducted by least once a year or as necessary. the company safety officer in a A revised copy of the program staggered manner shall be submitted to DOLE 3. Workers performing critical 4. A suitable construction safety occupations shall undergo the and health program (CHSP) mandatory competency specific for each construction assessment and certification by project shall be submitted to TESDA concerned DOLE-Regional office 4. Workers’ OSH Seminars and or field office training/orientation required by 5. The total cost of implementing the employer or by other OSH Programs shall be an regulations in the performance of integral part of the company’s their task shall be undertaken at operation cost no cost to the worker and considered as compensable OHS Personnel Complement working time All covered workplaces shall have qualified OSH personnel: 1. First Aider 2. Safety Officer Workers’ Welfare Facilities protective equipment, All workers shall have free access and technical guidance, use of the ff: recognition awards etc. 1. Adequate supply of safe drinking water Inter-Government Coordination and 2. Adequate sanitary and washing Cooperation facilities A joint coordinating committee 3. Suitable living accommodation shall be established to effectively (construction, shipping, fishing, implement the Law and its IRR night workers) The committee shall develop 4. Separate sanitary, washing, and mechanisms for harmonizing sleeping quarters (All genders) each agency’s mandate, policies, 5. Lactation station guidelines related to OSH with 6. Ramps, Railings etc reference to the law 7. Medical Facilities (treatment DOLE to collaboratively work room/clinic) with DENR, DOE, DoTR, DA, 8. Other worker’s welfare facilities DPWH, DTI, DILG-LGUs, DOH, as may be prescribed by the OSH DICT, PEZA etc standards and other issuances Penalties of Violations Joint and Solidary Liability Not more than P100,000 daily until The employer, project owner, full compliance contractor, or subcontractor and Willful failure or refusal to any person who manages, comply with OSH standards or controls, supervises the work compliance orders being undertaken shall be jointly reckoned from the date of and solidarily liable for issuance of Notice of Results or compliance with the OSH Compliance order Standards and corresponding penalties for violations Corresponding fine plus 50% Repeated violations of the same Incentives prohibited act shall be penalized Given to qualified every in-stance of repeat employers and workers in violation recognition of their efforts in ensuring compliance P100,000 with the OSH standards When the violation exposes the Shall be given in the form work to death, serious injury, or of training, additional serious illness Additional P100,000 fine Enforcement / Effectivity refusal to access the Enforcement is through the workplace DOLE0Regional offices having refusal to provide or allow jurisdiction over the workplace access to record D.O. 183-17 shall govern the obstruct investigation procedure in the implementation misrepresentation of DOLE D.O. 198-18 making retaliatory OSH Law IRR, DOLE D.O. 198-18 measures (termination, effectivity: January 25, 2019 refusal to pay, reducing wages and benefits or discriminates any worker who has given information relative to inspection) Fundamentals of Safety Management Risk Chance of physical or personal Safety loss Freedom from accident The control of hazards to attain Cost of Occupational Health and an acceptable lead of risk Safety Incident An event that may or may not result to loss Accident Unplanned or undesired event Not necessarily injurious or damaging that disrupts the completion of an activity Hazard Is any potential or existing Human Costs condition in the workplace that, The effect of accident to a worker by itself or by interacting with entails a lot of losses in terms of: other variables, can result in death, injuries, property damage, Disability - Temporary or and other losses permanent pain and suffering Loss of income; loss of earning Hazard Control capacity Involves developing a program Change in social life to recognize, evaluate, and Death eliminate the destructive efforts of hazards arising from human Economic Costs errors and from conditions in the The economic cost of incidents and workplace illnesses are far greater than most people realize (Direct Costs) Loss Control Is accident prevention, achieved Medical costs through a complete safety and Insurance premium health control program Employee compensation Regulatory penalties Indirect costs: Safety Management System Investigation of incident Cleaning up of incident site A term used to refer to a comprehensive Disruption in production business management system designed Repair/Replacement of damaged to manage safety elements in a materials and equipment workplace Training of new/replacement employees A basic safety management system’s Poor employee morale leading to main purpose is to: low production To ensure everyone in the Environmental litigation organization can recognize and Ecological remediation understand real or potential Marketing efforts to project hazards and associated risk image To prevent or control operational hazards and associated risk Three Basic Principles of Safety Responsibility and Accountability Planning Top management should set up 1. Detection of conditions and an effective health and safety practices which the safety management system to disciplines have identified as implement the safety and health hazardous policy which is proportionate to 2. The responsibility of challenging the hazards and risk the safeness of exposures that either are not covered by a Organization safety standard or clearly a Involvement of employees and suspected hazard in the light of their representatives in carrying experience, reasonable out risk assessments, deciding on judgment, and prudent preventive and protective extrapolations from existing measures and implementing hazard information those requirements in the 3. Application of the most workplace appropriate established countermeasures for controlling Control each of the identified hazards Clarifying health and safety responsibilities and ensuring that the activities of everyone are well coordinated Monitoring Top management should measure what they are doing to implement the health and safety policy To assess how effectively they are controlling risks, and how well they are developing a positive health and safety culture Review Involves reviewing the system of the whole health and safety management including the elements of planning, organization, control  OSH Guidelines for Hospitality and Hierarchy of Controls Tourism industry Workplace Hazard and their Control 1. Physical Hazard 2. Ergonomic Hazard 3. Biological Hazard 4. Chemical Hazard Injuries and diseases in the workplace Workplace Hazards and their Control occur due to unsafe acts and conditions Read Canvas for notes… Unsafe Acts Occur when employees do not conform or depart from an established standard, rules, or policy Unsafe Conditions Physical or chemical properties of a material, machine, or the environment which could possible cause injury to people, damage to property, disrupt operations or other forms of losses