New Zealand Businesses Urged to Prioritize Compliance Risk Management for Success
In today’s fast-paced business environment, effective risk management has become a critical aspect of operations in New Zealand. Compliance risk management is no exception, as it plays a vital role in ensuring organisations meet their strategic and operational objectives.
Why Compliance Risk Management Matters
Effective risk management can significantly improve decision-making, identify opportunities and threats, and enhance organisational resilience. A recent guide by [specialist audit and assurance services team] highlights the importance of compliance risk management, defining it as “activities carried out to reduce the impact of uncertainty to an acceptable level or take advantage of opportunities.”
Key Elements of Good Risk Management
The guide identifies four essential elements of a good approach to risk management:
- Framework: A robust framework is critical, with an up-to-date organisational risk management policy that incorporates principles described in AS/NZS ISO 31000:2009.
- Infrastructure: The right staff with necessary skills, experience, and competence are essential for developing, implementing, and maintaining the risk management framework. Effective systems and processes must be in place, including formal recording of risks in a register and up-to-date information and knowledge management systems.
- Application: Organisations must establish the risk context, identify risks comprehensively, analyse and evaluate them formally, and consider a full range of risk treatments.
- Monitoring and Review: Monitor and review processes must be in place, with clear commitments to risk management at governance level and regular reviews to ensure continuous improvement.
Importance of Compliance Risk Management for New Zealand Businesses
Experts stress that compliance risk management is essential for New Zealand businesses to meet legislative requirements, rules, regulations, and standards. “Effective risk management helps organisations achieve their objectives while ensuring they comply with relevant laws and regulations,” said [expert name].
The guide suggests several resources for further information on risk management principles and guidelines, including the Office of the Auditor-General and ISO.
Benefits of Prioritizing Compliance Risk Management
By prioritising compliance risk management, New Zealand businesses can:
- Improve their likelihood of meeting strategic and operational objectives
- Identify opportunities and threats
- Establish a consistent basis for decision-making and planning
- Ensure compliance with legislation
- Enhance organisational resilience
In conclusion, compliance risk management is a critical aspect of business operations in New Zealand. By prioritising this essential component, organisations can improve their overall performance and achieve long-term success.