Risk management in Switzerland

It is really sensational: For the first time, a government introduces a complete risk management system. Its foundations were developed at Austrian Standards — the ON Rule series ONR 49000.

Vienna (AS prm, 2010-12-16)

On 24 September 2010, Swiss President Doris Leuthard announced the implementation of a risk management system based on the specifications of ONR 49000 developed in Austria.

This set of rules that is considered to represent the state of the art world-wide covers all the processes and steps required for the introduction and practical implementation of comprehensive risk management — from risk identification to the training of highly qualified risk managers. Since 2004, more than 100 experts from almost 50 nations have contributed to its elaboration under Austria’s leadership.

For Swiss management consultant and risk manager Dr. Bruno Brühwiler who was substantially involved in its development, the ONR 49000 series constitutes a key steering concept for good governance. Based on a top-down approach starting from the perspective of the top management, it helps to reduce uncertainty in decision-making, close information gaps and better tackle complexity. The simple question of what can go wrong triggers new reflections that also support the strategic objectives in their entirety.

Switzerland: Risk policy raises security

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Credit: AS prm

The Swiss Federal Council which has already engaged in risk management activities since 2004 looked for a suitable system that could live up to increasing requirements. Eventually, the Swiss found what they needed in neighbouring Austria. “ONR 49000 provides helpful guidance, and we do not have to reinvent the wheel,” summarises Nicole Heynen, who is in charge of co-ordinating the risk management activities of the Swiss government, the major advantage of the system that is going to be introduced step by step in the Federal Chancellery, the seven departments (ministries) and around 60 agencies.

In her capacity as project manager, Nicole Heynen gathers the risk results of the departments and prepares risk reports for the Federal Council. These highlight the most significant risk scenarios for each department that are discussed intensively and form the basis of risk prevention programmes. “Risk management is an ongoing task that affects everybody and is continuously performed by all,” Ms. Heynen states the essence of risk management in a nutshell. In the case of Switzerland, it concerns a total of 36,000 federal employees.

Up to now, 30 risk managers have been trained and further courses are scheduled in all the seven departments for 2011. Risk expert Bruno Brühwiler who will provide the training on site: “We orientate to the objectives of the administration and try to make concrete risks tangible. By drawing up scenarios that reach ten to five years into the future, we anticipate the situation from diverse perspectives and analyse what could happen in the best and in the worst case.”

In the implementation phase, it was not quite easy to achieve consensus among the different departments, as Nicole Heynen explains: “Since risk management is not an exact science, every opinion and view had its merits.” Now that the risk policy has been officially adopted, the main challenge is to implement it and bring about the related change in the risk culture.

“We do not want to impose an obligation, but achieve a genuine commitment of all the departments,” states the federal risk manager. This has already been fully accomplished in some departments, while others still do not give high priority to this field. “It is, however, particularly important to identify strategic and policy risks, too,” says Ms. Heynen.

The ultimate objective is to use the harmonised methodology and system that the ONR 49000 series offers for representing the key risks per administrative unit, per department and for the entire Federal Council and for facilitating their consolidation.

At Austrian Standards, where a total of 123 employees support the economy, administration, academia and consumers in the development and application of standards, more than 900 risk managers have been trained on the basis of these specifications. They come from diverse sectors — from banking and healthcare to the energy and automotive industry — with the spectrum ranging from domestic SMEs to company groups active globally.

“We expect that the one thousandth risk manager will complete training in early 2011,” Bruno Brühwiler states with great satisfaction and continues: “As a result, we get an enormously broad effect and an incredible experience base.”

In Mr. Brühwiler’s opinion, the application of ONR 49000 by the Swiss government is an important signal that sets an example. He hopes that many enterprises and public institution will follow this model. Brühwiler: “Risk management according to ONR 49000 as a governance concept is hardly spectacular, but all the more sustainable.”

Managing Director Ing. Dr. Gerhard Hartmann of Austrian Standards also sees with great pleasure that the Austrian specifications are implemented in the political practice of the Swiss federal government: “This is a real recognition of the work accomplished at Austrian Standards. When this project was launched there were quite sceptical voices calling into question the need for such a set of rules. The training of risk managers on a generally accepted foundation based on a consensus of all stakeholders and, of course, the introduction by the Swiss government shows that we took the right decision.”

“The vision has developed extremely well,” concludes Mr. Brühwiler, “and Austrian Standards has set new international standards that are accepted world-wide.” Nicole Heynen is also confident that ONR 49000 is the optimum solution: “First results can only be expected in two or three years at the earliest, but we can already see that the culture is changing.”