Press release - 31 October 2008
UK businesses are still prepared to take risks despite testing economic times, according to BSI British Standards’ annual Business Barometer, published today. 74% of the FTSE 250 surveyed reported no difference in the willingness of their company to take risks now as compared with 12 months ago. Only 15% thought that their organization would be less disposed to risk taking.
The survey also found that:
- 93% of companies surveyed have both a risk management framework and risk management process in place
- 94% of companies employ a risk manager or someone who takes overall responsibility for risk
- 90% agreed that risk management reduces the likelihood of events that would have a negative consequence
- 87% of those surveyed believe that risk management protects revenue and enhances value for money
The research was conducted to coincide with the publication of BS 31100 Code of practice for risk management. The word ‘risk’ often has negative connotations and ‘management of risk’ can imply slowing things down which in turn threatens business growth and innovation. The new standard represents the contrary view that organizations should encourage opportunism and implement a risk management framework to cope with uncertainty.
This eagerly anticipated British Standard establishes the principles and terminology for risk management and gives recommendations for the model, framework, process and implementation of risk management. It can be used by organizations of all sectors and sizes as a basis for understanding, developing, implementing and maintaining proportionate and effective risk management.
Mike Low, Director of BSI British Standards, said, “Publication of BS 31100 could not be more timely. As we have seen in recent weeks, the scale of risk and opportunity among blue chip companies is enormous. Businesses of all sizes are operating in a challenging environment – they must manage their opportunities while controlling risk and this will be a fundamental skill to survive these difficult times. This standard provides a set of clear and simple guidelines which positions risk taking as a positive business facet. It’s very encouraging to see so many businesses engaging with risk and recognising the benefits that can arise from embracing such a framework.
Julia Graham, Chief Risk Officer of global legal practice DLA Piper and Chair of the BS 31100 drafting committee, said, “If you read any CEO survey these days the top answer as to what’s keeping them awake at night will be economic volatility. The credit crunch and what has followed has woken Boards up to the fact that failures in risk management are fundamental problems and part of the reason why they are in the position they are in now. BS 31100 raises the profile of risk management at just the right time and I think it could become a benchmark for organizations that do not want to make the same mistakes others have made.”
Further findings include:
- 49% of organizations view risk taking as a primarily positive activity (22% said they viewed it as ‘very positive’)
- 93% agreed that risk management improves accountability, decision making, transparency and visibility
The drafting committee responsible for BS 31100 includes 40 representatives from industry, government and academia including the Financial Services Authority, the Confederation of British Industry, the Institute of Risk Management, Southampton University, the Institute of Business Ethics and the Department for Business, Enterprise & Regulatory Reform. Public interest in the standard has been so great that 3000 comments were received on the first draft.
About BSI Group
BSI British Standards is part of BSI Group, a global independent business services organization that inspires confidence and delivers assurance to customers with standards-based solutions. Originating as the world’s first national standards body, the Group has over 2,300 staff operating in over 120 countries through more than 50 global offices. The Group’s key offerings are:
- The development and sale of private, national and international standards and supporting information
- Second and third-party management systems assessment and certification
- Product testing and certification of services and products
- Performance management software solutions
- Training services in support of standards implementation and business best practice.
For further information please visit www.bsigroup.com.