Controlling Risk Management

Controlling Risk Management

Controlling Risk Management

In a nonprofit organization, management of risk entails a wider range of responsibilities. Surely, a nonprofit leader has a fiduciary responsibility to manage and maintain the tangible assets of the organization. For a nonprofit leader, the responsibility for managing risk neither begins nor ends with the financial resources of the organization. A nonprofit organization, by definition, exists because it is serving some public interest. In a majority of instances (61.2%), a nonprofit organization is a public charity providing goods or services that support a charitable mission.

At a minimum, the leadership of a nonprofit organization has the responsibilities to anticipate and manage the risks in four broad areas: the lives and safety of the individuals served by the organization, the staff and volunteers that provide the service, the tangible assets of the organization and the intangible assets of reputation, and the integrity of the nonprofit organization. While some of the risks inherent in these four categories are interrelated, we will address each area in turn (Waheed, 2010).

Risk management is the management, i.e. for controlling or minimizing the involvement of risk. Risk management is the process to identify, assess and prioritize the risks, that how uncertainty affects on your objectives and goals and how a firm can monitor, minimize and control these probabilities of events. There are a number of risks that involve in a business, and market or the business have risk in order to tackle with them requires an effective manager. To explain the risk management, I would like to choose the example of the nonprofit organization and their risk management.

Non-profit organization is an organization and its risk management are slightly changed to the profit organization because the reason of existence of the nonprofit organization is to help, or to fulfill the needs by charting them, and that is not distributed its overall profit earned with its stakeholder or stockholders rather than utilization of these funds, they charity or help other organizations or needy, since these are nongovernmental organizations indeed.

In United State of America approximately 1.3million organizations have established and come under the nonprofit sector, and it is becoming more complex to deal with increasing number of stakeholder and demand. Although personally the nonprofit organizations are facing a lot of intimidations by the government that is a great upcoming risk, and a lot of lawsuits have filed against these firms which is highly costly and time consuming. Thus, only proper risk management strategies can lead them to control these suits because the purpose of the nonprofit organization is to help by charity, and if all money goes to the lawsuits then the purpose of existence will be diminished. Risk management strategies are the preplanning way of confronting and recognizing to overcome with future uncertainties (Anthony, 2002).

The Role of Good Management

The biggest aspect of risk management in all instances is prevention anticipating potential risks and developing procedures, policies, and systems to reduce the likelihood that the anticipated risk ...