Reporting to stakeholders on risk, the mitigation of risk and internal control

Overview & Purpose

What This Standard Covers

This Standard outlines the governing body’s responsibility in communicating the ongoing processes for identifying, evaluating, and managing risks to stakeholders. It focuses on disclosing key organizational risks and the mitigation strategies employed, as well as detailing the actions taken by the governing body during the reporting period.

Performance Criteria

• Report on key organizational risks, changes to strategy, and implications for risk exposure.
• Disclose monitoring of contingency and resilience planning for risk threats and opportunities.
• Report on management’s risk management information review and approval.
• Link risk reporting to organizational risk oversight and the business model.
• Address any risk oversight challenges encountered during the reporting period and actions taken.
• Communicate how broader economic and systemic risks are accounted for.
• Consider the impact of disclosing commercially sensitive risks to stakeholders.

Knowledge & Understanding Requirements

• Effective communication strategies for significant risks relating to the business model.
• Integration of risk reporting into narrative reporting.
• Presentation of risk updates to the board for assurance.
• Addressing changes to organizational strategy post-risk events for stakeholders.
• Demonstrating levels of assurance obtained from independent verification.
• Understanding the current regulatory framework for disclosure and stakeholder engagement.
• Awareness of the impact of disclosing commercially sensitive risk information.

Relevent Roles

• Managers and Senior Officials
• Directors and Chief Executives of Major Organizations
• Senior Officials of Special Interest Organizations
• Finance Managers and Chartered Secretaries
• Personnel, Training, and Industrial Relations Managers
• Chartered and Certified Accountants
• Management Accountants
• Company Secretaries