ISO 31000 and Enterprise Risk Management
After the International Organization for Standardization (ISO) introduced the “Risk Management: Principles and Guidelines on Implementation” (also known as the ISO 31000) in 2009, the Committee of Sponsoring Organizations of the Treadway Commission (COSO) updated their Enterprise Risk Management (ERM) standards written in 2004 to reflect new information introduced in the ISO 31000. COSO has led the way for other organizations to either write their own ERM initiatives or update current ERM initiatives. Let’s take a look at ERM initiatives and tactics your safety commissioner can use to write an updated ERM.
What is an ERM initiative?
An Enterprise Risk Management initiative is a detailed proposal of how individual companies can use ISO 31000 information to employ safe practices in the workplace. Some of the details that should be included in the ERM initiative are broken into the following four sections:
–Planning and designing section
–Implementing and benchmarking section
–Measuring and monitoring section
–Learning and reporting section
Let’s break down each of these sections.
Planning and Design Section
The first idea in the Enterprise Risk Assessment initiative, the planning and design section, addresses all of the structure necessary for implementation. This part of the initiative is often used to present the idea to the Board of Directors, so the planning and design section needs to be complete. It should tell the board why the ERM initiative will help the safety numbers, and it should lay out the entire plan, including the individual responsibilities for each proposed improvement. Also, the entire scope of the project should be addressed, and the language should be established.
Implementation and Benchmarking Section
The implementation and benchmarking section is written upon board approval of the planning and design section. This section should go into more detail about how the company will implement the new safety plan, and the measurement of the program’s success is established. At this point, risk benchmarks and tolerance levels are established, and the control measurement is developed. By establishing all benchmarks, the initiative will be able to measure the success in the next section.
Measuring and Monitoring Section
In this section, the success of the program is measured for later review. The costs are calculated, and more cost-effective procedures are often developed and implemented. The program’s success is also measured by the decrease in accidents and on how effectively the procedures are used by employees, so at this point, the safety numbers are collected for later review and the employees are closely monitored to determine the initiative’s effectiveness.
Learning and Reporting Section
The ERM initiative learning and reporting section is used to review all of the measurements taken in the measuring and monitoring section. The safety numbers collected are reviewed and compared to previous safety numbers, and the effectiveness of the program is reviewed based upon the reports issued pertaining to employee compliance to new safety procedures. These measurements are then used to make an overall assessment of ERM’s contribution to the risk controls, any improvements are monitored in this section.
The ERM initiative is an intense proposal and tracking system for the implementation and study of a new safety protocol idea. However, despite its daunting intensity, the ERM initiative can help your company establish and record the success of new safety protocols, providing an excellent source of information for safety management.