ISO 31000 has been updated

ISO 31000 Risk management – Principles and guidelines has been revised to provide clear and concise procedures to help organisations improve planning, and manage factors that threaten their objectives. The 2018 version places an emphasis on protecting value as the key driver of risk management. It also highlights other principles such as continual improvement, the inclusion of stakeholders, and human and cultural factors.

Jason Brown is Chair of the technical committee on risk management, which developed the standard ISO/TC 262.

“The revised version of ISO 31000 focuses on the integration with the organisation and the role of leaders and their responsibility,” he said in a press release. “Risk practitioners are often at the margins of organisational management and this emphasis will help them demonstrate that risk management is an integral part of business.”

The updated standard defines risk as “the effect of uncertainty on objectives”. It highlights the impact of incomplete knowledge of circumstances on an organisation’s decision making.

The main changes to ISO 31000:2018 include:

• Review of risk management principles.
• Focus on top management – leaders must ensure that risk management underpins governance and all other organisational activities.
• Greater focus on the iterative nature of risk management, actions and controls at each stage of the process.
• Simplify content with more emphasis on sustaining an open systems model that exchanges feedback with external stakeholders to fit multiple needs and contexts.

While the standard does not provide requirements and is not meant for certification, it offers managers a guide to creating and protecting value in organisations (through better decision-making, risk management, improving performance, and setting and fulfilling objectives).