Risk Management Plan: Rio Tinto

Running head: RISK MANAGEMENT PLAN
Risk Management Plan: Rio Tinto
Name of the student:
Name of the University:

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Table of Contents
Introduction.................................................................................................................................3
Definitions/ glossary of terms.....................................................................................................3
Objectives of risk management plan...........................................................................................3
Risk management policy.............................................................................................................5
Interdependency with strategic planning....................................................................................6
Relationship with corporate governance.....................................................................................7
Organization and responsibilities/ accountability.......................................................................7
Communication and consultation...............................................................................................8
Risk management framework (including context, matrix, criteria)............................................9
Risk identification and assessment techniques...........................................................................9
Risk management processes.......................................................................................................9
Risk register................................................................................................................................9
Risk profile..................................................................................................................................9
Risk appetite and risk tolerance................................................................................................10
Risk treatment plans..................................................................................................................10
Monitor and review...................................................................................................................11
Risk management programme..................................................................................................11
Performance measurement of the plan......................................................................................12
Risk management implementation plan....................................................................................12
References.................................................................................................................................13
Appendix reports (risk by area, risks by owner, risks with controls).......................................15

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Introduction
Risk management plan is referred to as one of the most essential relative project
knowledge area that has to be managed and also monitored throughout the business progress
and project progress as well. This report depicts the importance of implementing effective risk
management plan for the nominated company Rio Tinto. The ISO 31000:2018 is the standard
risk management guidelines that are mainly followed by the enterprises and organizations
base in both New Zealand and Australia.
Different risks that Rio Tinto Mining Company is facing these days are identified in
this report. Moreover, a detail risk management plan is also elaborated n the paper followed
by proper risk identification, risk analysis, risk impact and its likelihood and also respective
risk management action for each of the identified risks. The objectives of risk management
plan, the details policies to be followed are also elaborated in this paper. In order to resolve
these risks the different actions those can be taken are also illustrated n this report.
Definitions/ glossary of terms
Risk management, risk analysis, policy, risk register, risk treatment and
ISO31000:2018
Objectives of risk management plan
Assessing and managing risk is defined as a very important part of well managed and
well organized business organization. it is mandatory for any business or project to have an
accurate risk management plan place from the outset of the project. It has been found there
are many situation raises where projects address critical requirements that are essential to

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resolve very critical challenge or risk. Every project o business takes some risks. In other
words, for any project or business there are always some specific problems arises. Sometimes
consequences of these risks also come as a huge damage for the future of the business. Every
business requires resolving the risks by developing a risk management plan followed y Risk
management standard ISO: 31000:2018. After analyzing the current situation of Rio Tinto it
is found that the company has come across major structural changes and for that five different
teams were formed. Due to this reason there are huge chances of risk occurrences. For
overcoming such difficult situations the company should implement a risk management plan
in details.
The objectives of risk management plan are not different for varied organizations.
Rather the purpose of using risk management plan is always same for different organizations.
The risks are not always same. Therefore, based on the specific risk identified the risk
management plan as to be developed. The main objectives of developing risks management
plan is to identify the potential risks, analyze the risk, setting priorities for each risk to make
sure which risk needs to be solved earlier and which can be done late, risk impact analysis and
risk treatment planning. If the risk management plan is maintained throughout the business
life cycle then the company would be able to prevent these risks again in future. It is also
determined that without the help of an effective risk management plan the program
management office might find that the company is doing crisis management which is a
resource exhaustive process classically constrained by some restricted and available options.
The man objectives of the risks management plan are elaborated in the below section:
 To sketch detailed, actionable, appropriate, feasible planning that helps to
combat risks as well as business threats.

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 To provide approaches towards identification of risk, analysis of risk and
mitigation of risk as well
 To implement accurate mitigation strategies based on the identified risks
 To provide better quality and error free data for organizational decision making
 To make the escalations clear not only to the project manager and supervisor
but also to the rest of the business associates
 To improve the process of communication better and easier
 To make sure that the project is completed within assigned deadline and
budget
Risk management policy
The risk management policies are developed to improve the business performances
through growth opportunities optimization. It helps an organization remain competitive and
innovative as well alike others competitors. With the help of effective risk management policy
risks and uncertainties can be communicated and anticipated while required. The chances and
rate of operational losses get reduces with risk management policy. The project management
plan and risk management frameworks are always required to be developed followed by
proper risk management policies. It helps to protect the brand image and reputation of a
business enterprise along with the working associates. The RIO Tinto mining company
maintains HSEQ policy. According to this policy the company is focused to prevent the
incidents, injuries, pollution, illness, business interruptions, property damage and process
losses as well.
The objectives of following effective risk management policies are as follows:

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Proper risk management policy guides the business enterprise management
community to give consistent as well as systematic approaches for identification, analysis,
evaluate, monitor, reporting and treat the risks. It also make sure that management is
presented along with best data available based on which decisions can be further taken for
future growth and establishment. Risk management policy makes sure that, all the
management decisions taken are completely aligned to the business requirements and
appetites. The risk management policy also ensures that the company is running through
detail internal audit of the activities. Theses polices are definitely required to be maintained
by the Rino Tinto mining Company.
Interdependency with strategic planning
Risk management plan is very essential to manage large projects and business
operations successfully as well. Strategic risk planning is another very important knowledge
area for modern organizational operation and functional management activities. Regardless of
nature, size and nature of the business organization it faces risks. Most of the risks are defined
as probability to damage or threat, liabilities, loss etc. According to International Standard
Organization (ISO): 31000:2018 risks is the “effect of uncertainty and objectives”. It is found
that for different organizations risks are also different. Therefore, in order to manage each of
the individual risks strategies are also different. Risk mitigation or risk management plan is
dependent on the strategies those are to be developed for mitigating each of the identified
risks. In order to create an error free strategic line and to establish relationship between the
company objectives and mission risks are the only factors that can come as obstacles. In order
to eliminate this obstacle implementation of strategic risks plan is very important.

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Relationship with corporate governance
Corporate governance is referred to as asset of prcatices and rules that an organization
employs for directing their decisions as well as actions. These rules help to detect how a
company can reach its objectives and also how it can create a balanced infrastructure within
an organization as well. Corporate governance can significantly impact the performance of the
business organization. Apart from that, small businesses those employs ethical practices and
principals within their corporate governance activities may not be able to always make the
highest profit or high stock price as well. However, risk management plan have their other
benefits beyond the bottom line activities. In this new era technology has created great as well
as global interconnectivities which are referred to as a very essential asset for the Rio Tinto
mining company. On the other hand, the interconnectivity can make the risk taking process
much complex. The global change of risk management landscape is creating worldwide
conversation regarding how corporate governance principles need further evolvement. The
corporate governance maintained by the Rio Tinto organization is very strong and developed
considering the requirements of the suppliers, customers, government regulations,
stakeholders and management as well.
Organization and responsibilities/ accountability
In order to manage potential risks the company associates are accountable or
responsible. Based on the skills and knowledge of the individuals the roles and responsibility
of risk management are distributed among the associates. The risks identified for Rio Tinto
are all owned by the company head operation committee members. The responsibility or
accountabilities are elaborated below:
Risks Responsibility/ accountability

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Technical risk Technical experts
Political risk Company’s decision making community
Financial risk Finance manager
Operational risk Operation manager
Legal risks Legal advisor
Communication and consultation
Whenever the risks are identified it become essential to conduct meeting and
discussion to make sure that all the company associate are aware of the risks those have been
occurred. All the risks cannot be mitigated by the internal stakeholders but also there are some
other risks that cannot be mitigated without the support of the external stakeholders. It is
responsibility of the Rio Tinto company associates to take advice from the external
consultants to implement accurate risk management treatment plan for identified risks.
According to ISO 31000 risk framework it is identified that, in order to mitigate the
risks of Rio Tinto the company associates are needed to present the information to all the
other associates accurately and time followed by factual components. All the key stakeholders
are needed to communicate with each other throughout infact after each stage of completion.
The useful data are needed to be shared followed by internal management policy, maintaining
security, integrity and privacy as well. While haring such information individual’s respect
must not be hurt. The communication has to e a two way communication, which implies that
as soon as the risks will be informed the stakeholders will give feedback accordingly.

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Risk management framework (including context, matrix, criteria)
Risk identification and assessment techniques
Accurate application of these guidelines can also be customized sometime based
organization and its context as well. The ISO 31000:2018 also gives a common approach that
is used for managing different types of risks. However, these management plans are never
industry specific or any project specific.
Risk management processes
In order to treat risks the different processes those are available include:
 Risk treatment
 Risk acceptance
 Risk transfer

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 Risk mitigation
Risk register
The risk register developed for the company is comprises of risk id, risk description,
its impact and likelihood and respective risk management action taken to resolve individual
risk.
Risk profile
The risks identified for the Rio Tinto mining company are as follows:
 The mining prcatices followed by the company is very poor
 Different environmental issues are also there
 The growing market demand
 High level of competition
 Health and safety acts are all neglected
 Commodity price fluctuations
 Political issues throughout the country
 Lack of motivation for the employees
Risk appetite and risk tolerance
After analyzing the risks of Rio Tinto it is identified that the risk tolerance and risk
appetite for the individual identified risks are both high. In other words, the level of all the
identified risks are high thus cannot be bear for a long term.

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Risk treatment plans
The risk treatment plan those will be maintained for the risks identified for the Rio
Tinto Mining company are:
 Analysis of the reason for the risks
 Identification and description of the treatment options available
 Estimation of cost, benefits and risks
 Evaluation and selection of best treatment option
 Communication with the stakeholders
 Development of risk treatment program
 Implementation of the treatment plan
 Risk treatment plan’s verification and effectiveness analysis
Monitor and review
Whether the risk management plan is effective for the organization or not is checked
with the help of proper monitoring and review. The stages to be followed too monitor and
review the risks are as follows:
 Planning and implementation of best risk monitoring program
 Measuring performance
 Analysis of historic data
 Improvement commitment
 Earning staffs commitment
 External audit

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Risk management programme
For managing the risks of Rio Tinto mining company the program that is selected to
be sequentially followed by the company associates include:
 Identification of the risk
 Categorizing each risk
 Analyzing impact of each risk
 Prioritizing each risk
 Mitigation strategy development
 Final risk management plan evaluation
Performance measurement of the plan
Performance measurement plan is very essential to check how good the developed risk
management plan is. According to ISO 31000:2018 the risk management plan has to be
measured against the indicators that are reviewed periodically for checking the
appropriateness. The risks management performance is needed to be measured periodically
against the risk management plan and its deviation as well. The effectiveness of the risk
management framework is also needed to be checked in this stage.
Risk management implementation plan
In order to implement the risk management plan the stages those are to be followed by
the Rio Tinto operation and management group are:
 Defining the value that Rio Tinto will gain from the risk management plan
 Research and understating the various standard and risk framework

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 Analyzing current status of the organization
 Seeking for support and help
 Delegating fix risk owners
 Report presentation on progress of risk management plan

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References
Barafort, B., Mesquida, A. L., & Mas, A. (2017). Integrating risk management in IT settings
from ISO standards and management systems perspectives. Computer Standards &
Interfaces, 54, 176-185.
Barafort, B., Mesquida, A. L., & Mas, A. (2019). ISO 31000‐based integrated risk
management process assessment model for IT organizations. Journal of Software:
Evolution and Process, 31(1), e1984.
Bharathy, G. K., & McShane, M. K. (2014). Applying a systems model to enterprise risk
management. Engineering Management Journal, 26(4), 38-46.
Bourget, A. P. F., Chiriotti, E., & Patrinieri, E. (2019). Evolution of risk management during
an underground project’s life cycle. In Tunnels and Underground Cities. Engineering
and Innovation Meet Archaeology, Architecture and Art (pp. 4375-4385). CRC Press.
de Oliveira, U. R., Marins, F. A. S., Rocha, H. M., & Salomon, V. A. P. (2017). The ISO
31000 standard in supply chain risk management. Journal of Cleaner Production, 151,
616-633.
Gjerdrum, D., & Peter, M. (2011). The new international standard on the practice of risk
management–A comparison of ISO 31000: 2009 and the COSO ERM
framework. Risk management, 31(21), 8-12.
Hutchins, G. (2018). ISO 31000: 2018 Enterprise Risk Management. Greg Hutchins.

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Ibáñez, A. J. P., Bernal, J. M. M., de Diego, M. J. C., & Sánchez, F. J. A. (2016). Expert
system for predicting buildings service life under ISO 31000 standard. Application in
architectural heritage. Journal of Cultural Heritage, 18, 209-218.
Kiełbus, A., & Karpisz, D. (2019). Risk management as a process security tool. System
Safety: Human-Technical Facility-Environment, 1(1), 234-239.
Lalonde, C., & Boiral, O. (2012). Managing risks through ISO 31000: A critical analysis. Risk
management, 14(4), 272-300.
Leitch, M. (2010). ISO 31000: 2009—The new international standard on risk
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risk management: What role can the ISO 31000 risk management principles
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Appendix reports (risk by area, risks by owner, risks with controls)
What would stop our
organization objectives being
met?
What would be the result of this risk? Likelihoo
d
Consequ
ence
Risk
rating
(uncontr
olled)
What is in place to reduce the risk? Likelih
ood
1
Non supporting political
background Project will fil to meet the expected benefits Possible high A before initiating any project or policy the organization must make sure that
the government is supporting their activities
Possi
ble
2 lack of communication Lack of information sharing Likely high R Use of open communication instead of others Likely
3 No specific principle project progress may be hampered Possible Moderate A Besides risk management strategies the company should implement effective
managerial principles also
Possi
ble
4 Lack of financial support Company will face major financial loss Unlikely Low Y Before beginning any new plan and policy company has to identify their
sponsors
Unlike
ly
5 Legal issues Legal obligation will occur Rare high Y Must hire an experienced legal advisor Rare
6 No specific policy management will fail to manage the associated Possible Low Y Company should implement correct polices followed by ISO 31000:2018
Possi
ble
7 Insufficient funding expected projects will not be delivered easily Possible high A Proper funding must be done before beginning the project
Possi
ble
8
Lack of support from
suppliers
May not be able to meet the expected
outcomes Possible Moderate A Suppliers are needed to be selected by the company itself
Possi
ble
9
no health and safety
measures for the staffs Staffs will not feel motivated Possible Low Y Proper health and safety measures in terms of insurance and incentives must
be planned
Possi
ble
1
0 Reputational risk The status of the organization will be hampered Unlikely High A Completive awareness program evaluation
Unlike
ly
1
1 High competition existing in the market will become difficult Unlikely Moderate Y Developing products and services based on feedback given by customers
Unlike
ly
1
2 Lack of business strategies Completive advantages will not be easy to gain Rare Low G implementation of advanced business strategies Rare
1
3
Incorrect responsibility
distribution
People will fail to do their assigned
responsibilities Possible
Negligibl
e Y Implementing competitive business strategies
Possi
ble
1
4 Operational risk
The business operations will not be completed
according to requirements Possible High
A Developing best operational management plan and make sure that all the
operations are running correctly
Possi
ble
1
5
Dependent on Iron Ore Market competition rate will increase
Unlikely High A Company need to focus on other products as well.
Unlike
ly
1
6 Poor mining prcatices The company would fail to meet its objectives possible Moderate A selecting best mining practices followed by similar service providers
possibl
e
1
7
selection of wrong tool and
techniques
The project may to reach the expected
outcomes
almost
certain negligible A Before initiang the project proper tools and techniques has to be selected
possib
le
1
8 lack of team work
If the team fails to work together then team
goals would not met possible negligible Y Work load should be distributed respectively in the team members likely
1
9 lack of team cooperation
If team does not cooperate then work burden
will increase for individuals unlikely moderate Y Meeting must be organized everday after workig hours
unlikel
y
2
0 No performance reward
It will be non-motivational for the team
members possible moderate A Organization should arrange incenives and rewards and also performance
appraisal
unlikel
y