Fundamentals of Risk Management

https://mitpress.mit.edu
Taylor, E (2014) Practical Enterprise Risk Management, 
www.koganpage.com
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Risk culture 
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PART sIx cAsE sTUDIEs
Network Rail: Our approach to risk management
The purpose of our enterprise risk management (ERM) approach is to mitigate risks to the delivery of 
a safe, reliable and cost-effective service to our customers. ERM supports the building of capability 
in all areas of the business to recognize both risk and opportunity early. Early recognition of risk 
allows us to work collaboratively and proactively with customers, stakeholders and suppliers to 
manage our extensive portfolio of works better.
Across the group our approach to risk management balances the need to manage risks with 
identifying opportunities to improve performance through careful acceptance of some risk. We 
recognize our status as a regulated rail network infrastructure provider and the importance of 
maintaining essential service provision.
We take an enterprise-wide approach to risk management and have in place an ERM framework 
for the identification, analysis, management and reporting of all risk to strategic objectives. The 
framework also takes account of operational risk and recognizes the need for specialist approaches 
in areas such as safety, project management and information security.
The ERM framework provides a standardized approach to the identification, assessment, 
recording and reporting of significant risks. We analyse the possible causes of a risk and assess what 
the impact could be if the risk were to occur. For each risk we identify current controls and their 
effectiveness to manage underlying causes and minimize consequences. The full risk assessment 
process is conducted using the Bow-Tie methodology which provides a structured approach. We 
identify risks from a strategic view (top-down) and from the operational environment (bottom-up) to 
give better visibility of risk exposure across the enterprise.
Edited extract from Network Rail Limited
Annual Report and Accounts 2015