Internal audit involvement in enterprise risk management

Purpose The paper examines the impact of internal auditors’ involvement in Enterprise Risk Management (ERM) on perceptions of their willingness to report a breakdown in risk procedures and whether a strong relationship with the audit committee affects such willingness to report. The study also investigates the use of ERM and the role of internal audit in ERM in Australian private and public sector entities. Design/methodology/approach The study uses an experimental design, manipulating (i) the internal auditor’s involvement in ERM and (ii) the strength of the relationship between internal audit and the audit committee. Participants are 117 certified internal auditors. The study also gathers descriptive data on the use of ERM. Findings The study indicates that a high involvement in ERM impacts the perceptions of internal auditors’ willingness to report a breakdown in risk procedures to the audit committee. However, a strong relationship with the audit committee does not appear to affect their perceived willingness to report. The study also finds that the majority of organisations have recently adopted ERM. Internal auditors are involved in ERM assurance activities but some also engage in activities that could compromise objectivity.

From impact assessment to user-friendly risk management decision-making

In earlier cultures and societies, hazards and risks to human health were dealt with by methods derived from myth, metaphor and ritual. In modem society however, notions of hazard and risk have been transformed from the level of a folk discourse to that of an expert centred concept (Plough & Krimsky, 1987). With the professionalization of risk and hazard analysis came a preferred framework for decision making based on a range of 'technical' methodologies (Giere, 1991 ). This is especially true for decision processes relating to risk assessment and management, and impact assessment. Such approaches however, often entail narrow technical-based theoretical assumptions about human behaviour and the natural world, and the· methods used. They therefore carry 'in-built' error factors that contribute considerable uncertainty to the results.

Pandemic planning as risk management : how fared the Australian Federation?

The role of law in managing public health challenges such as influenza pandemics poses special challenges. This article reviews Australian plans in the context of the H1N1 09 experience to assess whether risk management was facilitated or inhibited by the "number" of levels or phases of management, the degree of prescriptive detail for particular phases, the number of plans, the clarity of the relationship between them, and the role of the media. Despite differences in the content and form of the plans at the time of the H1N1 09 emerging pandemic, the article argues that in practice, the plans proved to be responsive and robust bases for managing pandemic risks. It is suggested that this was because the plans proved to be frameworks for coordination rather than prescriptive straitjackets, to be only one component of the regulatory response, and to offer the varied tool box of possible responses, as called for by the theory of responsive regulation. Consistent with the principle of subsidiarity, it is argued that the plans did not inhibit localised responses such as selective school closures or rapid responses to selected populations such as cruise ship passengers.

Risk-management of UAS robust autonomy for its integration into civil aviation safety frameworks

This paper discusses a model of the civil aviation reg- ulation framework and shows how the current assess- ment of reliability and risk for piloted aircraft has limited applicability for Unmanned Aircraft Systems (UAS) with high levels of autonomous decision mak- ing. Then, a new framework for risk management of robust autonomy is proposed, which arises from combining quantified measures of risk with normative decision making. The term Robust Autonomy de- scribes the ability of an autonomous system to either continue or abort its operation whilst not breaching a minimum level of acceptable safety in the presence of anomalous conditions. The decision making associ- ated with risk management requires quantifying prob- abilities associated with the measures of risk and also consequences of outcomes related to the behaviour of autonomy. The probabilities are computed from an assessment under both nominal and anomalous sce- narios described by faults, which can be associated with the aircraft’s actuators, sensors, communication link, changes in dynamics, and the presence of other aircraft in the operational space. The consequences of outcomes are characterised by a loss function which rewards the certification decision

Progress and challenges of disaster health management in China : a scoping review

Background Despite the importance of an effective health system response to various disasters, relevant research is still in its infancy, especially in middle- and low-income countries. Objective This paper provides an overview of the status of disaster health management in China, with its aim to promote the effectiveness of the health response for reducing disaster-related mortality and morbidity. Design A scoping review method was used to address the recent progress of and challenges to disaster health management in China. Major health electronic databases were searched to identify English and Chinese literature that were relevant to the research aims. Results The review found that since 2003 considerable progress has been achieved in the health disaster response system in China. However, there remain challenges that hinder effective health disaster responses, including low standards of disaster-resistant infrastructure safety, the lack of specific disaster plans, poor emergency coordination between hospitals, lack of portable diagnostic equipment and underdeveloped triage skills, surge capacity, and psychological interventions. Additional challenges include the fragmentation of the emergency health service system, a lack of specific legislation for emergencies, disparities in the distribution of funding, and inadequate cost-effective considerations for disaster rescue. Conclusions One solution identified to address these challenges appears to be through corresponding policy strategies at multiple levels (e.g. community, hospital, and healthcare system level).

Risk management and high reliability : a case study of Australian airport management

This thesis investigated risk management and organisational reliability in airports from the perspective of complex sociotechnical systems (CSSs). Two research studies were undertaken, the first focusing on the processes by which disruptive events occur, are detected and responded to; the second exploring the presence of organisational reliability traits within airports. A key result of the studies was the development of new approach: the Critical Incident Disturbance Process model that detailed a means to understand and analyse how disruptions in complex CSSs might be influenced by vulnerability reduction and enhanced risk management. Further, this thesis identified and defined the concept of 'compartmentalised reliability' in complex sociotechnical systems, extending existing knowledge of high reliability theory.

Analysis of risk management disclosures by Australian publicly listed companies

In the aftermath of the global financial crisis, effective risk management (RM) and its communication to stakeholders are now considered essential components in corporate governance. However, despite the importance of RM communication, it is still unclear how and to what extent disclosures in financial reports can achieve effective communication of RM activities. The situation is hampered by the paucity of international RM Research that captures institution differences in corporate governance standards. The Australian setting provides an ideal environment in which to examine RM communication because the Australian Securities Exchange (ASX) has since 2007 recommended RM disclosures under its principle-based governance rules. The recommendations are contained in Principle 7 of the Corporate Governance Principles and recommendations (ASX CGPR). Accordingly, to assess the effectiveness of the AXS's RM governance principle, this study examines the nature and extent of RM disclosures reported by major ASX-listed firms. Using a mixed method approach (thematic content analysis and a series of regression analysis) we find widespread divergence in disclosure practices and low conformance with the Principle 7 recommendations. Certain corporate governance mechanisms appear to influence some categories of RM dislcosure but equity risk has surprisingly little explanatory power. These results suggest that the RM disclosures practices observed in the Australian setting may not be meeting the objectives of regulators and the needs of stakeholders.

The relationship between 'reasonably practicable'and risk management regulation

This paper examines two concepts which are central to contemporary standard setting in occupational health and safety (OHS) regulation, and explores the differences and similarities between these concepts – the notion of ‘reasonably practicable’ which qualifies the ‘general duties’ and some other provisions in the Australian OHS standards, and the risk management requirements typically found in OHS regulations and approved codes of practice (advisory standards in Queensland).

Expert Opinion: Serious Concerns regarding Western Australian Planning Commission (WAPC) Draft Policy 3.7 “Planning for Bushfire Risk Management” and associated Guidelines (May 2014)

10 page document containing expert assessment of shortcomings of Western Australian State Planning Policy SPP3.7- Planning for Bushfire Risk Management. Document produced on behalf of QUT and submitted to and published by the WAPC as part of their public consultation process for their draft policy.

Bicycle commuting and exposure to air pollution: A questionnaire-based investigation of perceptions, symptoms and risk management strategies

Background An increase in bicycle commuting participation may improve public health and traffic congestion in cities. Information on air pollution exposure (such as perception, symptoms and risk management) contributes to the responsible promotion of bicycle commuting participation. Methods To determine perceptions, symptoms and willingness for specific exposure risk management strategies of exposure to air pollution, a questionnaire-based cross-sectional investigation was conducted with adult bicycle commuters (n = 153; age = 41 ± 11 yr; 28% female). Results Frequency of acute respiratory signs and symptoms are positively-associated with in- and post-commute compared to pre-commute time periods (p < 0.05); greater positive-association is with respiratory disorder compared to healthy, and female compared to male, participants. The perception (although not signs or symptoms) of in-commute exposure to air pollution is positive-associated with the estimated level of in-commute proximity to motorised traffic. The majority of participants indicated a willingness (which varied with health status and gender) to adopt risk management strategies (with certain practical features) if shown to be appropriate and effective. Conclusions While acute signs and symptoms of air pollution exposure are indicated with bicycle commuting, and more so in susceptible individuals, there is willingness to manage exposure risk by adopting effective strategies with desirable features.

Framework for assessing the influence of critical infrastructure interdependencies in post-disaster reconstruction management

Due to ever increasing climate instability, the number of natural disasters affecting society and communities is expected to increase globally in the future, which will result in a growing number of casualties and damage to property and infrastructure. Such damage poses crucial challenges for recovery of interdependent critical infrastructures. Post-disaster reconstruction is a complex undertaking as it is not only closely linked to the well-being and essential functioning of society, but also requires a large financial commitment. Management of critical infrastructure during post-disaster recovery needs to be underpinned by a holistic recognition that the recovery of each individual infrastructure system (e.g. energy, water, transport and information and communication technology) can be affected by the interdependencies that exist between these different systems. A fundamental characteristic of these interdependencies is that failure of one critical infrastructure system can result in the failure of other interdependent infrastructures, leading to a cascade of failures, which can impede post-disaster recovery and delay the subsequent reconstruction process. Consequently, there is a critical need for developing a holistic strategy to assess the influence of infrastructure interdependencies, and for incorporating these interdependencies into a post-disaster recovery strategy. This paper discusses four key dimensions of interdependencies that need to be considered in a post-disaster reconstruction planning. Using key concepts and sub-concepts derived from the notion of interdependency, the paper examines how critical infrastructure interdependencies affect the recovery processes of damaged infrastructures.

Spontaneous and episodic volunteers: The legislative, insurance and risk management framework

Baby Boomers are a generation of life long association joiners, but following generations prefer spontaneous and episodic volunteering. This trend is apparent not only during natural disasters, but in most other spheres of volunteering. Legal liability for such volunteers is a growing concern, which unresolved, may dampen civic participation. We critically examine the current treatment of these liabilities through legislation, insurance and risk management.

Risk management strategies using seasonal climate forecasting in irrigated cotton production: a tale of stochastic dominance.

Decision-making in agriculture is carried out in an uncertain environment with farmers often seeking information to reduce risk. As a result of the extreme variability of rainfall and stream-flows in north-eastern Australia, water supplies for irrigated agriculture are a limiting factor and a source of risk. The present study examined the use of seasonal climate forecasting (SCF) when calculating planting areas for irrigated cotton in the northern Murray Darling Basin. Results show that minimising risk by adjusting plant areas in response to SCF can lead to significant gains in gross margin returns. However, how farmers respond to SCF is dependent on several other factors including irrigators’ attitude towards risk.

Risk management for mycotoxin contamination of Australian maize

Recent incidents of mycotoxin contamination (particularly aflatoxins and fumonisins) have demonstrated a need for an industry-wide management system to ensure Australian maize meets the requirements of all domestic users and export markets. Results of recent surveys are presented, demonstrating overall good conformity with nationally accepted industry marketing standards but with occasional samples exceeding these levels. This paper describes mycotoxin-related hazards inherent in the Australian maize production system and a methodology combining good agricultural practices and the hazard analysis critical control point framework to manage risk.