Robust risk management ensures Amplius can operate successfully when challenges and opportunities arise and is an integral part of good corporate governance.
The importance of risk management drives our commitment to have a ‘risk aware culture’. This means we understand that whilst risk cannot always be eliminated, managing risk through mitigations and controls can reduce the likelihood and impact of risk on the business as well as keeping our customers safe.
Our Regulator, the Regulator of Social Housing, expects us to have an effective risk management and internal control assurance framework. Our framework includes our strategic approach to risk, our methodology for the assessment of risk, reporting mechanisms and specific risk management responsibilities across all levels of the organisation.
Risk management framework
Our Risk Management Framework enhances our:
- ability to deliver our objectives
- ability to keep customers and colleagues safe
- reputation and trust with customers and stakeholders
- ability to innovate and evolve as an organisation
- financial sustainability
- effective planning and decision making
- leadership, management and governance.
Assurance
Amplius uses the ‘three lines of assurance’ on controls within its risk framework, which forms the basis of assurance reporting to the Boards and its Committees.
Reports are provided to the Board in respect of both principal and operational risks.
Our online risk management platform provides real time access to risk reports and key areas of assurance.
The annual programme of internal audits undertaken by KPMG is influenced by Amplius’ risk register and the outcomes of these audits are reported quarterly to the Audit and Risk Committee. In addition to internal audits, we undertake various multi-variant scenario tests, analysing the impact and effect on Amplius’ financial covenants and viability. Mitigations are then developed to ensure that we can recover from the impact of each scenario.
Risk appetite
An agreed risk appetite supports effective decision making and provides a clear steer for colleagues as to what areas of risk are important to Amplius.
The Board has overall responsibility for risk. They are responsible for ensuring that Amplius, as a not-for-profit business, acts in ways that minimises the risk of serious failures and ensures that social housing assets are not placed at undue risk. We recognise that we’re not able to operate in a ‘risk free’ environment and that our framework of internal controls can only provide reasonable, and not absolute, assurance.
We are aware that control weaknesses and compliance issues can still arise. The framework of key controls that we operate are designed to minimise and manage the impact of these risks occurring or affecting the business.
The Amplius Board and Executive Team regularly review and update our risk appetite in line with Amplius’ corporate strategy and the wider environment.
Principal risks and uncertainties
Over the last 12 months integration risk following the merger has been high on the Board’s agenda. Supported by the Integration Committee, these risks have been well managed and have enabled a smooth transition. The Board also remains vigilant in terms of customer safety, with key areas of risk such as Health and Safety and Compliance remaining a focus. The broader environment, both in the sector and beyond, and the uncertainties that lie there, are being monitored as part of risk management, stress testing and business continuity activities.
Our risk framework is used to devise a set of principal risks.
Amplius currently has 14 principal risks within the risk register:
Heat Map of Principal Risks
1
Health and Safety (Building Environment)
Rating: 12
Appetite: Cautious
2
Health and Safety (Operating Environment)
Rating: 6
Appetite: Cautious
3
Information Security
Rating: 6
Appetite: Cautious
4
Data Quality
Rating: 9
Appetite: Balanced
5
Development
Rating: 6
Appetite: Open
6
Government Policy, External Environment
Rating: 12
Appetite: Cautious
9
People, Culture and Execution Capability
Rating: 9
Appetite: Open
12
Care, Support/Failure to meet CQC Standards
Rating: 1
Appetite: Balanced
7
Asset Management
Rating: 9
Appetite: Open
10
Financial Shock & Organisational Resilience
Rating: 8
Appetite: Balanced
13
Customer
Rating: 12
Appetite: Open
8
Sustainability, Net Zero, Carbon Retrofitting
Rating: 6
Appetite: Balanced
11
Ineffective Board and Executive Leadership
Rating: 4
Appetite: Cautious
14
Merger, Integration and Change
Rating: 9
Appetite: Balanced