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Even though many religious institutes are similar and operate in a similar
way, the risks that you each face and your attitude to dealing with these will
be different. It is not possible to provide a one-size- ts-all risk management policy for every charity. Charity trustees should not in any event rely upon a pro-forma risk management policy. Part of the process of developing a policy is about you being able to understand the risks your charity faces, putting in place appropriate plans and learning how to adapt to meet those challenges. You cannot do this from a pro-forma policy.
IS IT A LEGAL OBLIGATION TO
HAVE A RISK MANAGEMENT POLICY?
This is not really the question to ask. Managing risk is something that should be cultural within your charity. Every day we individually have to manage risk, for example, when we decide which side of the bed to get out of in the morning through to crossing the road during the day. These are all decisions that can only be taken when we are informed of the risks involved. Therefore a risk management policy is essential.
However, to answer the question, if your charity is legally required to have its accounts audited, then you will have to make a risk management statement in your trustees’ annual report that con rms that “... the charity trustees have given consideration to the major risks to which the charity
is exposed and satis ed themselves that systems or procedures are established in order to manage those risks.”
Charities (Accounts and Reports) Regulations 2008
This is re ected in the charities SORP (2015) which provides at paragraph 1.46 that your charity trustees’ annual report should include “a description of the principal risks and uncertainties facing the charity and its subsidiary undertakings as identi ed by the charity trustees, together with a summary of their plans and strategies for managing those risks”. It is no longer enough to simply use pro- forma wording to state that you have considered the major risks and have plans in place. You must summarise in narrative the plans and strategies you have in place to actually manage those risks.
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