Purpose

1.1 The purpose of this policy is to:

– Ensure that [Charity name], a registered charity, identifies and manages risks effectively.

– Safeguard the charity’s assets, reputation, and operations.

– Ensure compliance with the Charity Commission for England & Wales’ risk management guidelines for registered charities.

– Promote a culture of proactive risk management across all levels of the organization.

Scope

2.1 This policy applies to:

– All trustees of [Charity name].

– All staff and volunteers of the registered charity.

– Contractors, third-party suppliers, and other stakeholders acting on behalf of [Charity name].

2.2 Risk management includes all types of risks that could impact [Charity name], including but not limited to:

– Financial risks

– Operational risks

– Reputational risks

– Compliance risks

– Health and safety risks

– Governance risks

Definitions

3.1 Risk: A risk is any event or circumstance that could negatively affect [Charity name]’s ability to achieve its objectives or threaten its assets, reputation, or compliance with legal obligations.

3.2 Risk Management: The systematic process of identifying, assessing, managing, and mitigating risks to reduce their impact on the registered charity’s operations.

3.3 Risk Appetite: The level of risk that [Charity name] is willing to tolerate in pursuit of its charitable objectives. This may vary depending on the nature and type of risk.

Roles and Responsibilities

4.1 Trustees

4.1.1 The trustees of [Charity name] are ultimately responsible for risk management, ensuring that adequate systems and processes are in place to manage risks. The trustees must:

– Regularly review the risk management policy.

– Approve the risk management framework and risk register.

– Monitor high-level risks that could threaten the registered charity’s ability to operate.

– Ensure compliance with the Charity Commission for England & Wales’ guidance on managing risks in a registered charity.

4.2 Senior Management Team

4.2.1 The senior management team is responsible for implementing risk management practices on a day-to-day basis, including:

– Identifying, assessing, and mitigating risks.

– Maintaining the charity’s risk register.

– Reporting significant risks to the Board of Trustees.

– Ensuring that all staff and volunteers are aware of their responsibilities in relation to risk management.

4.3 Staff and Volunteers

4.3.1 All staff and volunteers of [Charity name] are responsible for:

– Identifying and reporting potential risks in their areas of work.

– Complying with the charity’s risk management policy and procedures.

– Acting in a way that minimizes risks to the registered charity.

Risk Management Process

5.1 Identification of Risks

5.1.1 Risks must be identified at all levels of the registered charity. Risks may arise from both internal and external factors, including financial instability, regulatory changes, or unforeseen events.

5.1.2 Risk identification should be an ongoing process and should involve:

– Regular staff and management meetings to discuss potential risks.

– Input from trustees, staff, volunteers, and beneficiaries.

– Review of external factors such as changes in law, economic conditions, or sector-specific risks.

5.2 Assessment of Risks

5.2.1 Once risks are identified, they must be assessed in terms of their likelihood of occurring and their potential impact on the registered charity. This assessment will be based on two factors:

– Likelihood: How likely is the risk to occur?

– Impact: If the risk occurs, what would be its potential impact on [Charity name]?

5.2.2 The assessment will be recorded in the charity’s risk register, and risks will be prioritized based on their overall risk rating.

5.3 Managing and Mitigating Risks

5.3.1 For each identified risk, [Charity name] will determine the appropriate measures to manage and mitigate the risk. These measures may include:

– Avoiding the risk: Altering plans or processes to avoid the risk altogether.

– Reducing the risk: Implementing procedures to minimize the likelihood or impact of the risk.

– Transferring the risk: Using insurance or third-party contracts to transfer the risk to another party.

– Accepting the risk: Acknowledging the risk where the potential impact is low and within the charity’s risk appetite.

5.3.2 Action plans will be developed for significant risks, detailing the steps to be taken to mitigate the risk and the individuals responsible for implementing these actions.

Risk Register

6.1 [Charity name] will maintain a risk register that records all identified risks, their assessments, and the strategies for managing or mitigating them. The risk register will include:

– A description of each risk.

– The likelihood and impact ratings.

– The risk owner responsible for monitoring the risk.

– Mitigation actions and control measures.

6.2 The risk register will be reviewed by the trustees at least quarterly, and updates will be made as necessary.

Monitoring and Reporting

7.1 Continuous monitoring of risks is essential to ensure that risk management strategies remain effective and up-to-date. Monitoring will be conducted through:

– Regular risk assessments and updates to the risk register.

– Reports from staff and volunteers on emerging risks or issues.

– External audits or evaluations, as necessary.

7.2 The senior management team will report to the Board of Trustees on high-priority risks and any significant changes in the risk landscape. Trustees will also receive a comprehensive risk management report annually, in line with the charity’s governance responsibilities.

Training and Awareness

8.1 [Charity name] will ensure that all trustees, staff, and volunteers receive training on risk management to build awareness of the risks facing the registered charity and to equip individuals with the skills to identify, assess, and mitigate risks effectively.

8.2 Risk management training will be incorporated into the induction process for new trustees, staff, and volunteers. Refresher training will be provided periodically to ensure that all parties remain up-to-date on best practices and any changes to the risk management framework.

Crisis Management and Contingency Planning

9.1 As part of its risk management framework, [Charity name] will develop contingency plans for critical risks that could seriously impact the charity’s ability to operate, such as natural disasters, IT system failures, or reputational crises.

9.2 These contingency plans will outline:

– Immediate actions to be taken to manage the crisis.

– Communication strategies to inform key stakeholders.

– Recovery processes to ensure continuity of operations.

– Responsibility for executing the contingency plan.

Compliance and Legal Obligations

10.1 [Charity name] is committed to ensuring that it complies with all legal and regulatory obligations relating to risk management as a registered charity.

10.2 The charity will seek professional advice as necessary to ensure that all risks are managed in accordance with the guidelines provided by the Charity Commission for England & Wales.

 Review of Policy

11.1 This Risk Management Policy will be reviewed annually by the Board of Trustees to ensure its effectiveness and compliance with legal and regulatory requirements.

11.2 Any amendments or updates to the policy will be communicated to all staff, volunteers, and relevant stakeholders of the registered charity.

Conclusion

12.1 [Charity name] is committed to fostering a proactive approach to risk management, ensuring that potential threats are managed effectively to protect our operations, reputation, and charitable mission. By adhering to this policy, [Charity name] will ensure it remains a resilient and compliant registered charity.

Signed: ……………………………

[Chair of the Board of Trustees] 

[Date] ………………………………