Term Paper on "Corporate Risk Management"

Term Paper 10 pages (3093 words) Sources: 2 Style: Harvard

[EXCERPT] . . . .

UK Local Authority approached us with the request to delineate the corporate risks associated with a pop music festival in the local council park. The task of the risk assessment and mitigation team will be to assess all associated corporate risks and create a document on the nature and management of these.

There are various types of risks associated with a pop music event. Mainly, both the foreseen and unforeseen element of risk should be taken into account in terms of risk assessment and reporting. These are then divided into general types of corporate risk, including financial, reputation, and safety risk.

This document is organized into three parts in order to describe the precise risks and necessary management measures involved. Firstly, the precise details of the risks are described. Secondly, a plan is described for the mitigation of risks before, during and after the event. Thirdly, conclusions and recommendations are offered in terms of risk management.

Corporate Risks

The most important type of risk associated with the pop music event is financial. Specifically, the Authority's investment is threatened by a number of factors such as its investment in equipment, property, rented items, construction, and unforeseen events such as fire or rain that could lead to damage. Musical and electrical equipment can fail and result in damage claims by artists and owners of rented equipment. Construction prior to the event could lead to injury or possible death of workers, resulting in financial claims by workers and/or family members. This can damage the corporate investment in the event.

During the event, the organizer's reputation may be damaged by a number of factors associated with the nature of the event and its attendees. The noise level may for example damage the reputation of the organizers in terms of maintaining the peace in the neighborhood. Because a large number of attendees are expected, it is also expected that the music presentations will have to be loud in order to be audible to the entire crowd. Furthermore, it is also expected that the crowd will produce a high level of noise. This could be perceived as a bad influence on the community and carry with it an unfavorable impression in the eyes of the community.

The behavior of the crowd could also impact the corporate reputation unfavorably. Issues such as substance abuse and concomitant fighting may for example result in the perception of unfavorable influences on the community. Furthermore, there is also the danger of theft or trampling in the case of unforeseen disasters such as fire.

Where a large gathering of people are involved, it is also likely that a number of health and safety risks are at stake. In addition to the risks of substance abuse and fighting, other health risks include unforeseen medical emergencies such as heart failure, fainting, childbirth and other similar problems. Security risks include crimes such as selling illegal substances under the cover of the crowd and nose, theft, and stampeding or trampling in the case of possible disasters.

In order to address the above risks, specific planning needs to be incorporated during the stages before, during and after the concert event.

Program of Action

Before the Event: There are a number of measures the Council can take prior to the event in order to mitigate the variety of possible risks associated with it. The first step is to use the services of a thorough and high-quality risk assessment team. It is essential that this team have experience with the types of risks involved, as well as the type of event planned. An experienced risk assessment team has the highest likelihood of implementing sufficiently appropriate measures for mitigating the risks involved.

In terms of financial risk, the corporation should ensure that all electronic and musical equipment is safeguarded against disasters such as fire or rain. Temporary constructions such as canopies can for example be incorporated in the event of rain. Plastic covering can also be incorporated to protect equipment while canopies are constructed to ensure that the even continue. A sufficient supply of water and/or other fire extinguishing equipment should also form part of the event, particularly if flammable substances such as wood or cloth are used in the preparation of the site. Another option is insurance against unforeseen disasters. Possible claims by artists or rental companies can then be partially or wholly covered by such insurance. When this option is considered, the Council should ensure that all the requirements of the insurance contract, including all possible safety measures, are met. Finally, financial risk can be mitigated by ensuring a sufficient number of paying attendees. In this, fees, advertising, and quality service should be offered to the public.

In terms of reputation, it has been mentioned that the noise level and behavior during the event may be influenced by an excess of substances such as alcohol. This reflects badly upon the organizer of the event. To mitigate this, the Council should ensure that the public is fully informed regarding the event and its concomitant levels of noise and/or discomfort to the general public. This can be done by means of public notices and newspaper reports. To mitigate reputation risks, the Council can also emphasize that a percentage of the proceeds will be offered to charitable organizations. A further way in which to handle possible public complaints is by means of public opinion polling. Polls can be created to assess the opinion of the public in terms of the planned event. This will provide the public with a sense of control over their environment and also improve the image of the Council as a corporation that takes responsibility for its reputation and its environment. Finally, the event can be planned for a time during which the noise level will be least disturbing to the public. It can for example be arranged to occur during a public holiday or a weekend, for example.

In terms of safety, planning prior to the event should includes safety testing. All constructions and temporary equipment should be thoroughly tested for adherence to safety standards. Temporary canopies and other constructions are included in such testing. Technical and electrical equipment should be tested against the event of short circuits that may lead to fire or electrocution. Public safety should also be ensured in terms of the human factor. Security professionals should for example be employed in sufficient numbers for the projected number of patrons to the concert. These professionals should include both the police and medical personnel. Medical personnel should also be employed in sufficient numbers for the projected size of the crowd and unforeseen events that might take place. Further health and safety precautions include security and health vehicles, including police vans and ambulances in the event of the need for crowd control and/or transport needs in the case of injury.

To mitigate the risk of claims as a result of injury, the Council may choose print and distribute pamphlets to be handed to all visitors prior to the event. These can then include a description of the safety measures taken prior to the event in order to ensure the safety and security of all visitors to the concert.

During the Event: During the event, a number of measures are necessary to ensure that the risk mitigation planning prior to the event is successful. While the event is ongoing, the most important factor is continuous crowd safety. At the same time, it is necessary to maintain an acceptable level of comfort for the attendees at the concert. Security personnel should therefore be posted at regular intervals throughout the crowd, while also being unobtrusive. In order to do this, it might be suggested that these personnel be dressed in unofficial street clothes, to blend with the crowd. The crowd can however be made aware of their presence in order to ensure that the temptation to commit criminal acts is minimized. Throughout the event, the security personnel should then monitor the crowd for any irregularities, especially in terms of substance abuse and violence. Security personnel should also be in continuous contact with each other via communication devices such as unobtrusive microphones and speakers. When security problems such as fighting or criminal actions do occur, these personnel can then act quickly and be sufficiently prepared to mitigate the problem before it escalates beyond control.

Security personnel should also be in continuous contact with medical personnel in order to monitor and mitigate any possible medical emergencies. Crowd density should also be monitored in such a way that emergency personnel can reach any site of unrest as quickly as possible when necessary.

It will also be the task of security and medical personnel to ensure that stampeding does not occur in the event of fire or rain. This is another reason why the entire crowd should be continually monitored for density. To do this, officials should encourage concert goers to leave sufficient walking space between them. The crowd should also be fully informed regarding actions to be taken in… READ MORE

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