Information is the most powerful risk management tool

It is because the most significant risks, like sexual abuse and misconduct (SAM) risk, need the most powerful tools that it is so important to understand the importance of information in risk management.

One reason information is so important is because the opposite of well-informed decision-making is guesswork and the safety of minors and vulnerable adults obviously deserves the best-informed decisions.  A step above guesswork are the experience, impulses, gut feelings, and rules of thumb – cognitive biases – we use to fill information gaps when making decisions.  Cognitive biases vary so widely, impact different people so differently, and are so reliably unreliable at supporting effective decision-making that the more they are replaced by reliable information, the better. 

Another reason is that it is frequently said, “you can’t improve what you can’t measure”.  One of the main reasons SAM risk has grown so much over the last 15 years is that SAM risk management broadly hasn’t changed and therefore hasn’t improved.  The reason for this is that neither SAM risk nor its management have been measured.  So the information that would have alerted risk managers of the need to change wasn’t developed.  As a result, SAM risk has grown far faster than it would have done if SAM risk and its management had been measured, and SAM risk managers had therefore been able to adapt to the changes in SAM risk.

Information is also important to risk management at a fundamental level.  Risk is calculated by multiplying the potential likelihood of something by its potential cost.  Without some information, risk cannot be calculated:

  • if you don’t know that something can happen, you don’t know you have a risk in the first place;
  • until you know how often the something could happen – potential frequency – you don’ know if you need to worry about the risk;
  • if you don’t know that there could be consequences if the something happens, you don’t know how much you need to worry about the risk; and
  • until you know the range of possible consequences, and preferably their potential costs or benefits (bearing in mind risk can be positive or negative), you don’t know what you should be investing in making sure the risky something does or doesn’t occur.

There is also a direct relationship between how much information you have and how much risk you have, though the relationship varies by risk.  Broadly, the more you know about a risk and in particular, how to manage it, the less risky it is.

Ideally, there is a set of information a SAM risk manager needs to ensure minors and vulnerable adults are as safe from SAM as possible.  You need to know:

  • the types of SAM minors and vulnerable adults in your care are potentially exposed to;
  • the most effective ways of protecting your minors and vulnerable adults from the most likely or damaging types of SAM;
  • whether you are using the most effective tools as effectively as you could be; and
  • when and how you need to adapt your tools to changes in SAM risk, SAM risk management, or your organization.

A SAM risk manager needs the most powerful tools and no other tool is more powerful than reliable information.  The more and more reliable information a SAM risk manager has and the better they use that information, the safer the minors and vulnerable adults are in their care.

Author

Tim Jaggs, BOKRIM Founder

E: tim@bokrim.com

T: +1 (925) 450 6540

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