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Risk management is an important best practice which is mandatory for all business and non business enterprises. There is need to consider both visible and invisible forms of risk to protect the workers and the company as a whole. This is why the ISO 31000 was established in 2009 to bring consistence to the methodologies and models differing between companies and all business institutions.

What is the ISO 31000?

The ISO 31000 is an international standard which was developed to help every type of organization with risk management. It provided principles, frameworks and processes to help in risk management in a systematic and transparent manner.  It is applicable to all public, private or community enterprises, groups, individuals or associations.

Risk Management with ISO 31000

According to the ISO 31000 compliance with it ensures the following best practices to ensure risk management:

• It creates and protects value for goods and services
• It is an important part of best practice in all organizational processes
• It helps in decision making
• ISO 31000 addresses uncertainty as an integral aspect risk management
• It emphasizes a systematic, planned and timely approach to issues in any organization
• It requires the best quality of information
• Cultural and human factors are also taken into account
• ISO 31000 requires transparency as an essential best practice.
• Being dynamic it is flexible to changes
• It ensures constant improvements in the organization

Risk Management Framework with ISO 31000

The framework in compliance with the ISO 31000 ensures simplified risk management processes. It creates the ideal environment which facilitates best practices in development and implementation of risk management processes. The elements of risk management framework comprise of:

• Directives and Commitment: The success of any risk management effort requires the consent and support of the senior management and funding. Therefore proposals for how to identify, eliminate risks must be presented to the senior management before implementation.
• Design the framework: This required proper knowledge about how the organization works, internal and external risks, vulnerabilities and critical activities.

Processes in Risk Management with ISO 31000

Once there is compliance with ISO 31000 organizations can implement risk management programs and upgrade them according to standards. In new risk management programs ISO 31000 is an essential integrated best practice tool. This facilitates constant monitoring and reviewing of the framework to ensure risk management.

Organizations implementing the ISO 31000, experience continual improvement while risk management is successful.

Further reading: Corporate Governance | Audit | Performance Improvement