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WATER SECTOR RISK GOVERNANCE: An implementation guide for South African water utilities
Expanded Title:The overall average maturity of the organisations varied from 2.4 (initial) to 3.9 (managed) out of a possible score of five. The Water Boards and the metropolitan municipalities were observed to have a higher maturity level compared to the small municipalities or municipal entities. It was found that all organisations assessed undertake risk management primarily in the form of routine risk assessments, water safety and wastewater risk abatement planning. Risk governance is more than just the assessment of risk however. Most organisations had established some risk governance practices and are moving towards a governance approach to risk at an enterprise level. Ten of the organisations have an average maturity score of between two and three. This suggested they have recognised the need for and benefits of risk governance and established at least basic processes and procedures, possibly to meet regulatory requirements. In some cases these organisations have developed a managed approach that exceeds regulatory requirements and extends across core business areas. There is some documentation that details certain procedures, responsibilities, criteria and methods relating to risk management and basic audit mechanisms verify compliance. There is some cross-functional and external consultation and adequate resources in place. Organisations at this maturity level are still vulnerable to change and uncertainly and are still reactive in some management approaches. Furthermore the approaches used are generally still linear in application with risk being merely a product of the likelihood of an explicit event and its consequence. Iterative and holistic frameworks of risk governance rather than just risk management are not fully established. Three organisations have an average maturity level between 3.4 and four. As organisations move from a maturity level of three to four they start to embed their risk management activities at an enterprise level with processes, procedures and systems in place to work across all functional boundaries providing an integrated response to events. At this level of maturity systems and performance metrics are in place to evaluate the effectiveness of the risk management system, data is actively used to improve business processes and provide assurance. Risk is considered holistically, key stakeholders are consulted and involved in decision making and a risk aware culture is becoming established. Effective risk management and governance is a fundamental requirement for the safe and reliable provision of water services. In the complex, interconnected and globalised world of today, the water sector in South Africa can greatly benefit from an approach that offers value across every function of the organisation. Although all participating organisations had begun their journey to risk excellence, many still have considerable steps to take in order to achieve the full value from risk activities. A compendium of local and international case studies on risk governance in the water sector was produced. In addition, a guide for the implementation of risk governance in the water sector was produced.
Date Published:01/06/2016
Document Type:Research Report
Document Subjects:Drinking water - Water treatment, Drinking water - Water supply
Document Keywords:Policy and regulation
Document Format:Report
Document File Type:pdf
Research Report Type:Technical
WRC Report No:TT 669/16
ISBN No:9781431207992
Authors:McDonald A; Fell J
Project No:K5/2416
Originator:WRC
Organizations:Arup (Pty) Ltd; University of Cape Town
Document Size:3 607 KB
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