How should a board manage risk?

  • Careful monitoring of the activities and performance of the organisation, underpinned by a good understanding of the activity.

  • A comprehensive, thorough, risk management process that is regularly updated and reported to the board.

  • Strong awareness of the implications of all decisions the board makes, including the possible effect on reputation and finance.

A board may be under a duty to report a serious incident to a funder or regulator, including the Commission. The Commission defines a serious incident as an adverse event, whether actual or alleged, which results in or risks significant harm to a charity’s beneficiaries, staff, volunteers or others who come into contact with the charity through its work; loss of the charity’s money or assets; damage to a charity’s property; or harm to your charity’s work or reputation. “Significant” means significant in the context of your charity, taking account of its staff, operations, finances and/or reputation.

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