How can risk management within water utilities be improved?
The challenge
Managing risk and opportunity for water utilities is central to water safety and security, serviceability, profitability, environmental sustainability and improved water quality. Changes in regulations, increased pressure from customers and financial stakeholders, and the added complexity of long-term risks such as changing climate, demography and infrastructure renewal are all leading to the need for better risk management.
Water utility managers – and board members – need practical guidance in understanding and managing such risks within their organisations.
The solution
A new guide ‘Risk governance: an implementation guide for water utilities’ provides water utility managers and Boards with advice on the implementation of risk management, information on closer engagement with business leaders on issues of risk, improved integration of risk across the business, and coordination of risk information within their organisations.
Authored principally by Professor Simon Pollard, Head of Cranfield’s Department of Environmental Science and Technology, the publication was funded by the US Water Research Foundation, the City of Calgary Water Services, and a consortium of international water utilities.
Simon Pollard explains that: “Our user-friendly guide is for risk managers new to their role. This is a challenging job in most utilities because to be effective, risk managers must support colleagues in the business units and inform their Boards on issues that impact business performance and reputation. The guide will help risk managers scope out, and focus on, business critical elements of the job.”
Resulting benefits
The new guide has been endorsed by Rob Pritchard, City of Calgary Utilities and Environmental Protection General Manager, who said: “This is a tremendously useful guide for utility managers, not just to inform themselves, but to lay the ground work for a common understanding and a consistent approach to risk management across their organisations.”
David Owen, Risk Policy Manager for Yorkshire Water, said: "I would encourage any new, aspiring or experienced Risk Manager to apply the content and principles in this guide to help make an impact in your organisation. For me this guide provides the condensed experience of many experts from different utilities in one place and is invaluable."
Future directions
Cranfield University has over 25 years experience in risk governance in the water sector, and a recent report on strategic risk management for Portuguese water utility EPAL has been awarded an International Water Association Project Innovation Award. Its findings provide the basis for long-term, strategic planning under conditions of climate, demographic and land use change along with other mega-trends.
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