What Are The Basic Principles Of Risk Management?

What are the 10 principles of risk management?

These risks include health; safety; fire; environmental; financial; technological; investment and expansion.

The 10 P’s approach considers the positives and negatives of each situation, assessing both the short and the long term risk..

What are the 5 components of risk?

The five main risks that comprise the risk premium are business risk, financial risk, liquidity risk, exchange-rate risk, and country-specific risk. These five risk factors all have the potential to harm returns and, therefore, require that investors are adequately compensated for taking them on.

What are the types of risk management?

Types of Risk ManagementLongevity Risk.Inflation Risk.Sequence of Returns Risk.Interest Rate Risk.Liquidity Risk.Market Risk.Opportunity Risk.Tax Risk.

What are the 5 principles of risk assessment?

What are the five steps to risk assessment?Step 1: Identify hazards, i.e. anything that may cause harm.Step 2: Decide who may be harmed, and how.Step 3: Assess the risks and take action.Step 4: Make a record of the findings.Step 5: Review the risk assessment.

What are the key elements of risk management?

5 Key Elements of Risk ManagementIdentify the assets to be protected. … Identify the threats to those assets. … Apply controls in a layered, overlapping way until the risks are reduced to an acceptable level.Test the adequacy and effectiveness of the controls.Monitor the program and periodically repeat the process.

What are the 3 levels of risk?

1.3 Risk levels We have decided to use three distinct levels for risk: Low, Medium, and High.

What are the 4 principles of risk management?

Four Principles of ORM Accept risks when benefits outweigh costs. Accept no unnecessary risk. Anticipate and manage risk by planning. Make risk decisions at the right level.

What are the 8 principles of risk management?

Let’s look at each a little more closely.Integration. … Structured and comprehensive. … Customized. … Inclusive. … Dynamic. … Uses best available information. … Considers human and culture factors. … Practices continual improvement.

What are the elements of risk assessment?

Summary. A risk assessment is carried out as a sequence of six steps: plan the risk assessment, define the study, identify hazards and initiating events, develop accident scenarios and describe consequences, determine and assess the risk, and risk presentation.

What are the two elements of risk management?

This article describes the steps in the process — your job is to put them into action as soon as possible.Step One: Identify Risk. … Step Two: Source Risk. … Step Three: Measure Risk. … Step 4: Evaluate Risk. … Step 5: Mitigate Risk. … Step 6: Monitor Risk.

What are the 5 risk management process?

Five Steps of the Risk Management ProcessStep 1: Identify the Risk. The first step is to identify the risks that the business is exposed to in its operating environment. … Step 2: Analyze the Risk. … Step 3: Evaluate or Rank the Risk. … Step 4: Treat the Risk. … Step 5: Monitor and Review the Risk.

What are the 4 elements of a risk assessment?

There are four parts to any good risk assessment and they are Asset identification, Risk Analysis, Risk likelihood & impact, and Cost of Solutions.

What are the three principles of risk management?

Principles of Risk ManagementThe process should create value.It should be an integral part of the organizational process.It should factor into the overall decision making process.It must explicitly address uncertainty.It should be systematic and structured.It should be based on the best available information.More items…•

What are the 5 elements of safety?

5 Core Elements of Successful Safety ProgramsSAFETY CULTURE. … EMPLOYEE TRAINING AND EMPOWERMENT. … HAZARD IDENTIFICATION AND CONTROL SYSTEMS. … FOCUS ON COMPLIANCE. … CONTINUOUS IMPROVEMENT. … LEADERSHIP AND ORGANIZATIONAL BUY-IN. … THE SAFETY MANAGER ROLE. … What is a safety manager’s job role?