Charity Finance Group and Sayer Vincent LLP
Overivew: Risk management is not new – it has long been a requirement of the charity Statement of Recommended Practice (SORP) for charities to state how they identify, assess and mitigate risks.
Over the last couple of decades we have seen the introduction in the commercial world of various codes and standards on risk including the Cadbury code and Enterprise Risk Management – providing much more comprehensive risk management in listed public companies. This made us all realise that risk was not just a topic for the finance people and that risk management needed to embrace all the operations of a company, not just reflect the internal financial controls.
Since then the topic of risk management has moved on considerably further. Most organisations including charities would rank risks to their reputation as the ones that will have the most impact. As we have seen in events affecting well-known charities, significant damage to your reputation can cause an organisation to close its doors or at least to suffer a drop in income.
