Capturing Upside Risk

Foreword

The value of any activity or project for an organisation is linked intrinsically to its objectives. Unless an activity or project enhances the organisation’s purpose and objectives, then it has little value. David defines risk as ‘uncertainty that matters’. Something matters if it has an impact on objectives, otherwise it doesn’t matter and it represents no risk. Similarly, if there is no uncertainty then there’s no risk, whether objectives are affected or not.

The relationship between activities and value is often complicated, and objectives provide a concise framework for linking the two. Several international standards adopt this approach to understanding how much risks matter and how risk management can help managers make better, ...