Improving Risk Reporting
When a Board receives risk reports that are lengthy and unfocussed, it can be likened to navigating a road cluttered with too many signs.
Just as drivers need clear and concise signage to reach their destination safely and efficiently, board members require succinct and targeted risk reports to make informed decisions efficiently.
Here are some of the usual strategies to streamline risk reporting:
🚨 Highlight Key Risks:
Think of this like prioritising road signs. Just as "Stop" and "Give Way" signs are crucial for immediate safety, emphasise those risks that require immediate board attention due to their potential impact on the organisation. Most risk reports use a traffic light system in the report: red for critical risks, yellow for moderate risks, and green for low risks. Do not forget to think about this in terms of deviation from Risk Appetite. But most importantly, think about why you are escalating and what you want the Board to THINK, FEEL and DO in response to your highlighted risks.
⬆ Executive Summaries:
This can be compared to a directional sign that gives a quick overview of the route ahead. Encourage the inclusion of an executive summary at the beginning of the risk report. This should outline the key points, allowing the board to grasp the crucial information at a glance and decide if a deeper dive into certain sections is necessary. I once heard of a CRO who wrote a 'cover letter' to the Board (in my head it was hand written for a personal touch) which gave their personal insights on what was being reported. Factual, to the point, impactful.
📊 Use Visual Aids:
Similar to road signs, using symbols to quickly communicate information, visual aids like charts and graphs can help summarise complex information and trends at a glance. They should highlight changes in risk levels and the effectiveness of risk mitigation strategies over time. Maybe even include a story telling call out, summarising the insights gained through a key moment in the business, like the improvements made from undertaking systemic incident analysis or a post implementation review.
Actionable Suggestions?
1. Conduct a review of the current risk reporting format and content with the board to identify what information is truly needed and what can be minimised.
2. Implement a template for future reports that prioritises clarity and brevity, focusing on key risks and using visual aids effectively.
3. Train report preparers on the importance of clear, concise communication, tailoring content to meet the board’s requirements for decision-making.
#MakeItSnappy #ActionableRiskReporting #WalkAwayInformed #EnableDecisions
August Advisory