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Risk management

Boards or Committees of Management (COM) board secretaries, officers, and committee members of State Sporting Organisations (SSOs) and State Sporting Organisations for people with disabilities (SSODs) need to be aware their legal obligations and commitment to quality and safety are critical in today’s sporting environment. If you serve on a board or committee, risk management is one of your key responsibilities.

What is risk management?

Risk management is the process of systematically eliminating or minimising the adverse impact of all activities which may give rise to injurious or dangerous situations.  This requires the development of a framework within which risk exposure can be monitored and controlled.  Risk management is a tool by which persons involved in sport can seek to meet their duties and thus avoid liability.
Risks which can be covered by a risk management program include:

  • Legal risks – losses and costs arising from legal actions for breach of a common law or statutory duty of care
  • Physical risks – injuries to participants and the public
  • Financial risks – increased insurance premiums, costs associated with injuries for business reasons, loss of financial stability and asset value, replacement costs and earning capacity and increased external administrative costs

A common mistake SSO’s make is to view risk management as a program in isolation. It is really an ongoing process that should be applied to all SSOs policies and procedures.

Risk responsibility

The Board or COM of a SSO is responsible for overseeing the establishment and implementation of risk management systems by the SSO.  They are also responsible for reviewing the on-going effectiveness of these systems.  

The role of the Board or COM in relation to risk includes:

  • overseeing the creation, implementation and maintenance of the risk management system of the SSO;
  • establishing a risk profile for the SSO setting out both financial and non-financial material and/or strategic risks facing the SSO;
  • reviewing the effectiveness of the SSO’s implementation of its risk management systems on an on-going basis;
  • seeking to reach a common understanding with management (whether paid or volunteer) and auditors about key financial and regulatory risks and related controls including focusing on the “key” risks which are considered to be currently, or may in the future be, more significant or more likely to occur;
  • analysing the effectiveness of the SSO’s risk management and the effectiveness of their implementation;
  • developing an understanding of the overall business environment, laws and codes which are relevant to the SSO and the programmes that the SSO has in place to provide reasonable assurance of compliance;
  • reviewing the SSO’s occupational health and safety policies and ensuring regular reporting to the Board or on issues related to occupational health and safety;
  • reviewing insurance coverage and claims trends;
  • assess, monitor and manage the operational, financial reporting and compliance;
  • provision of the necessary tools and resources to identify and manage risks;
  • review of risks on an annual basis, including identification of new risks, changes to existing risks and retirement of previously identified risks (through a formal decision-making process);
  • regular reporting of the status of risks;
  • appraisal of actions taken to manage risk and correction of inappropriate performance;
  • internal compliance and control systems for the implementation of the risk management plan;
  • consideration of non-financial audits; and
  • compliance with regulatory requirements and best practice.

Managing the risks associated with the SSO and the sport will encourage more people to join because of the fact the environment is safe.

Risk management policy

The SSO’s risk management policy provides the framework to manage the risks associated with its core activities, including the Sport.  

The objectives of this Risk Management Policy are to:

  • to protect the SSO from all areas of operation;
  • to reduce the incidence of injury to participants, officials and other persons;
  • to provide a fun, healthy and safe sporting environment; and
  • to minimise potential liability as a result of poor management.

Risk management approach

The Australian Standard on Risk Management (AS/NZ ISO 3100:2018 provides guidelines on managing risk faced by organisations. The application of these guidelines can be customized to any organization and its context.

ISO 31000:2018 provides a common approach to managing any type of risk and is not industry or sector specific.

ISO 31000:2018 can be used throughout the life of the organization and can be applied to any activity, including decision-making at all levels.

The Guidelines for Managing Risks in Sport and Recreation (HB 246:2010) set out a systematic approach you can use to manage risk.

More information

NSW Volunteering - Risk Management for Not for Profit Organisations 
NSW Volunteering - Risk Register Template 
Play by the Rules – risk management advice for people in sport 
Our Community – Risk Management 
Clearinghouse for Sport 

Disclaimer

Note: as with any legal documents, this does not replace obtaining legal advice on each sports specific requirements and it is recommended you do so.

The information provided is for your information only. The authors and the NSW Office of Sport accept no responsibility for the accuracy of the information or your reliance upon it.