Page 52 - The Insurance Times February 2025

Case Study

Risk Framework Implementation - Adoption of

ISO 31000

Executive Summary able to risks such as supply chain disruptions, safety incidents,
and cybersecurity threats.
This case study details the adoption of the ISO 31000 Risk
Management Framework by a global manufacturing com-
pany to address its fragmented and inconsistent risk man- This case study examines how a leading global manufactur-
agement practices. Prior to implementation, the company ing company identified gaps in its existing risk management
practices and adopted the ISO 31000 Risk Management
faced challenges including operational inefficiencies, regu-
latory non-compliance, reputational damage, and financial Framework to address these challenges. The ISO 31000
losses due to poorly managed risks. These issues highlighted framework provides principles, guidelines, and a structured
the urgent need for a comprehensive, organization-wide risk process to manage risks effectively, enabling organizations
to align risk management with their strategic objectives.
management framework.
The company adopted ISO 31000, an internationally recog- The company's task was to integrate the ISO 31000 frame-
nized risk management standard, to unify its approach to work across all functions and processes to establish a uni-
identifying, assessing, and mitigating risks. The implemen- fied, proactive approach to risk management. This included
tation process involved securing leadership commitment, addressing specific challenges such as fragmented risk prac-
developing a risk management policy, creating a centralized tices, compliance issues, and a lack of centralized risk vis-
risk register, standardizing methodologies, and training ibility.
employees. Additionally, the company leveraged technology
to enhance risk visibility and monitoring capabilities. Definition of Key Terms
1. Risk Management Framework (RMF): A structured and
Post-implementation, the company achieved significant standardized approach to managing risks across an or-
improvements, including enhanced compliance with regu- ganization.
lations, reduced risk-related incidents, improved operational
efficiency, and increased stakeholder confidence. Despite 2. ISO 31000: An international standard for risk manage-
challenges such as initial resistance and high implementa- ment that offers principles and best practices applicable
tion costs, the long-term benefits far outweighed the limi- to all organizations, regardless of size or industry.
tations. 3. Risk Appetite: The level of risk an organization is will-
ing to accept to achieve its objectives.
This case study provides an in-depth analysis of the imple- 4. Risk Register: A centralized document used to record,
mentation process, results, limitations, and key recommen- evaluate, and monitor identified risks.
dations, offering valuable insights for organizations seeking
to adopt a robust risk management framework. 5. Key Risk Indicators (KRIs): Metrics that provide early
warning signals about potential risks.
Introduction
The Problem
Effective risk management is critical for organizations to
navigate uncertainties, ensure resilience, and achieve long- Challenges Faced by the Company:
term sustainability. The global manufacturing industry, with The manufacturing company operated in multiple locations
its complex supply chains, strict regulatory requirements, with varying risk management practices, leading to the fol-
and reliance on advanced technology, is particularly vulner- lowing issues:

The Insurance Times February 2025 47