word 'risk' has many different meanings. The Macquarie dictionary
includes the following:
1. exposure to the chance of injury or loss; a hazard or dangerous chance:
to run risks.
o the hazard or chance of loss.
o the degree of probability of such loss.
o the amount which the insurance company may lose.
o a person or thing with reference to the risk involved in insuring them.
o the type of loss, as life, fire, theft, etc., against which insurance
policies are drawn.
risk management risk is defined as:
chance that something happening will have an impact on objectives
risk is often specified in terms of an event or circumstances
and the consequences that may flow from it. Risk is measured
in terms of a combination of the consequences of an event and
their likelihood. Risk may have a positive or negative impact.'
(Australian Standard 42360:2004)
management involves managing to achieve an appropriate balance
between realising opportunities for gains
while minimising losses. It is an integral part of good management
practice an an essential element of good corporate governance." (Foreword
of Australian/New Zealand Standard Risk Management AS/NZS 4360:2004).
management in essence is a process of:
the risks (For example by considering the likelihood of events
and the consequences or impacts of events)
the risks ( For example by avoiding the risk, controlling
the risk, financing the risk, transferring the risk (eg
insurance) or reducing the risk through changed work practices)
monitor and review
with all concerned.
these steps are simplified. For example the Community
Services Safety Pack from WorkCover describes the essence
of risk management (within an Occupational Health and Safety
1. Think -
about what may effect employees and others health, safety
or welfare. This step is to identify hazards and assess
the risk they pose.
Talk - with employees. Consult about matters that may effect employees
and others' health, safety or welfare.
3. Do -
what is necessary to make the workplace safe. Implement risk controls.
Review - and monitor OHS measures (ensure risk controls are effective)
Types of risk management
are many forms of risk management, for example, financial risk
management, occupational health and safety risk management, crisis
The emphasis and models of risk management can vary with the type
of organisation. For example the construction industry has
a big emphasis on risk management in relation to worker safety, whereas
a financial investment agency puts emphasis on financial risk
In human services some areas where risk
management process can be used include: