“Risk” describes any uncertainty about future events that could threathen an organisation’s ability to accomplish its mission and achieve its objectives. Unmanaged risk could pose serious threats to an organisation’s core assets, with negative results. Regardless of what an organisation’s objectives are, or its financial status, all non-profit oganisations have vital assets at risk.
Unmanaged risk could pose serious threats to an organisation’s core assets, with negative results.
CORE NON-PROFIT ASSETS GENERALLY FALL INTO THE FOLLOWING FOUR CATEGORIES:
1. People for example, board members, staff, clients, donors, volunteers and the public.
2. Property for example buildings, facilities, equipment, resource materials and copyrights.
3. Income for example grants, contributions, income from sales.
4. Goodwill for example, reputation amongst stakeholders, ability to ensure impact, and the ability to raise funds and appeal to prospective partners (including volunteers).
These assets need to be protected, to the fullest extent possible, from undue harm or negative impact.
Risk refers to something that may happen, but bear in mind that is also may not happen. We may not always be able to prevent exposure to risk, but it is possible to avoid the negative impact of exposure, and we can manage (and thereby reduce) its impact on the organisation.
AUTHOR: Inyathelo Publication: The Board Walk | Good Governance Guide No. 2 | Second Edition
