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provides details of the general principles of risk management and provides practical applications and considerations for successful implementation. This guidance note supersedes the RICS information paper The management of risk (2000). Effective 25 September 2015 RICS guidance note 3 rics.org
Overview. Risks can represent threats as well as opportunities. Project risk management is one of the 13 PMI knowledge areas. Activities occur across the Planning, Executing, and Monitoring & Controlling process groups.
In this International Standard, the expressions “risk management” and “managing risk” are both used. In general terms, “risk management” refers to the architecture (principles, framework and process) for managing risks effectively, while “managing risk” refers to applying that architecture to particular risks. vi.
Risk has two aspects: downside risk or threats, which if they occurred would adversely affect project objectives, and upside risk or opportunities, which if pursued would positively affect the project objectives. This guide focuses on the downside threats, which for the sake of brevity of this guide are called risks.
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Two main purposes of the risk manage-ment are to ensure that adequate measures are taken to protect people, the environment and assets from undesirable consequences of the activities being undertaken, and to balance different concerns, for example safety and costs.
The risk management process is a clearly defined methodology, enabling individuals and teams to understand what risks (threats and opportunities) are present that may impact on their defined objectives,
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What is Risk Management? • Risk Management is a defined set of coordinated activities to direct and control an organization with regard to risk. • Risk Management allows an organization to identify risk mitigation strategies so the organization can achieve its goals 2
