A set of operations carried out by organizations and companies to achieve their goals, through which they can identify, manage, remedy and evaluated risks, in terms of impact size.
As well as the strategy that followed, to manage risks and follow up on the risks presented, and through these operations, the organization protects its facilities and employees.
It is an integrated system that internally can control the organization, where risk management system performs daily, weekly and monthly follow-ups as part of the internal control activities, Follow-up is through review of analytical reports and management committee meetings with relevant experts.
Strategy of risk management within organizations
According to the risk management system, to deal with hazards there are several procedures in place:
- Avoidance: the removal, of any activity that may lead to danger.
- Reduction: to reduce the risks that may lead risks.
- Alternative procedures: decisions making and some actions that can lead to a reduction in risks.
- Insurance: It is to insure against risk, or hazards.
- Acceptance: It is to take no action, accept the existence danger.
- Danger of exposure to Risks: It can lead to damage to institutions and property damage as well as natural disasters.
- Financial risk:
They are money financial related risks such as pricing, currencies liquidity, and asset risk.
- Operational risks:
Product failures, reputation risks, institution risks, knowledge drain risks and internal overfishing risks.
- Strategic Risks: The strategy includes social trend and capital availability.
Benefits of the new international standard for risk management
It has many benefits, this includes:
improving operational efficiency, defining the organization’s risk management policy, and improving the management system while increasing credibility and safety.
The institutions that can manage risks effectively are the most successful in protecting themselves and continuing with development.
The risk management system applies in all private and public organizations and bodies, whatever their size is