Risk Management Certification
24.04.2023
Back to blog listRISK MANAGEMENT CERTIFICATION
Risk is present in every aspect of our lives, from everyday activities such as choosing a route to work to complex business decisions such as opening a manufacturing facility in another country, and to be on the safe side it’s reasonable to understand what is risk management. In recent decades, great efforts have been made to better understand risk and its nature, leading to the development of methods and approaches that enable individuals and organizations to make accurate decisions based on logical reasoning. One of the most significant frameworks for managing risk is ISO 31000, an international standard that provides principles, best practices, and guidelines for managing risk in organizations. Risk management certification is the easiest way to go in these circumstances.
What is ISO 31000?
ISO 31000 is an international standard that provides guidance for managing risks of all types in all business areas. The standard provides guidance on the principles, framework for risk management, and application of the risk management process.
ISO 31000 is applicable to organizations of all types and sizes that want to integrate risk management into their business functions. It covers the risk management principles that form the basis for risk management and guides organizations in developing a risk management framework:
- Integrate risk management into organizational structures
- Designing a risk management framework that fits the context of the organization
- Implementing the risk management framework
- Evaluating the effectiveness and continuously improving the suitability and adequacy of the risk management framework
- Demonstration of leadership and commitment (top management)
ISO 31000 considers the risk management process to be an integral part of overall management and decision making. The risk management process can be applied at the strategic level and organization-wide, but it can also be applied to projects, products, and processes. ISO 31000 provides guidelines for risk communication and consultation, defining the scope, context and criteria, risk assessment, risk treatment, monitoring and review, and finally risk recording and reporting.
What are the benefits of becoming certified to the ISO 31000 Risk Management Standard?
Organizations operating in any industry and in any location are constantly exposed to risks. Managing these risks based on the principles, frameworks and procedures outlined in ISO 31000 provides a level of assurance that enables organizations to succeed and thrive in an environment of constant change. Implementing ISO 31000 guidelines can improve operational efficiency by facilitating the integration of risk-based decision making into an organization's leadership, planning, management, reporting, policies, values, and culture.
ISO 31000 enables organizations to identify the potential risks that could impede the achievement of business objectives. It also helps them determine the significance of risks and decide which risks should be mitigated first to achieve objectives before they impact the business, and keep all other risks effectively under control. In addition, ISO 31000 best practices enable organizations to develop a desired risk management culture.
A risk management approach based on ISO 31000 guidelines clearly demonstrates that organizations are committed to managing risk in all areas of the business. It builds customer and other stakeholder confidence by demonstrating the organization's ability to mitigate internal and external threats. A risk management process based on ISO 31000 improves an organization's reputation and gives it a competitive advantage.
Who is responsible for ISO 31000 risk management in the organization?
The foundation of risk management is to identify and analyze risks. This involves actively managing and influencing both the nature and extent as well as the impact of risks. This makes ISO 31000 a management task.
The responsible person at management level is in control of regular reporting in the form of risk reports and thus keeps management informed of all possible risk situations. In this way, it is possible to ensure an overview of all risks, to react quickly to them, and to control the necessary measures in the company.
This is done on the basis of the so-called Plan-Do-Check-Act principle (PDCA for short). First, the goal and purpose of the risk policy are defined (plan). Then it is time for the actual active process of risk management, where risks are identified, analyzed and evaluated (Do). After the policies are implemented, they are reviewed (Check) and, if necessary, further measures are taken to minimize them (Act).
What is the new approach to risk management according to ISO 31000?
The ISO 31000 standard works with a holistic top-down approach. This means that all risks in a company as well as their possible solutions are recorded. This makes risk management useful not only on a strategic level, but also on an operational level of the company.
However, as mentioned, ISO 31000 risk management is a management task. It is therefore important that its application is promoted from the management level to the other subordinate areas of the company. A risk management officer plays an important role here, serving as a liaison between employees and managers.
Why should you seek ISO 31000 certification?
ISO 31000 certification proves that you have the necessary competencies to help an organization create and protect value. It also demonstrates that you are capable of helping organizations develop a risk strategy, achieve strategic goals, and make informed decisions.
ISO 31000 certification helps you:
- Differentiate yourself from other risk management professionals
- Demonstrate awareness of risk management principles and other underlying risk concepts
- Demonstrate competencies to create a risk management framework tailored to an organization's needs and context
- Demonstrate the ability to apply the risk management process based on the recommendations of ISO 31000
- Demonstrate awareness of the importance of integrating risk management into key activities and functions of an organization
- Have a more successful career in risk management
