Posted: May 15th, 2019 2:02pm UTC

Risk management in the energy sector

Risks facing the energy sector

The energy sector has a wide range of risks affecting it; these include strategic risks, project risks, technical, health & safety risks, operational risks, business continuity, security and global economy risks.

The latest IRM report ‘Fuelling the debate, Latest risk management trends in the energy sector 2019’ had some interesting findings. The report shows that strategic risks, global economy and the skills gap are considered top risks for the sector.

Green energy issues considered low risk
Only 27% of respondents ranked green energy issues as ‘significant’ or ‘major’ in the next 5 years. This is surprisingly low as the EU has said that all new cars sold in the zone will be electric after 2035. Oil and gas companies will need to review their strategic and business models if they are to remain profitable. Accidents were also ranked low in importance. This is probably since there are many controls in place and these risks are already mitigated well across the sector.

Energy sector aims
The main aims of the sector according to the report, were to reduce costs, improve organisational efficiency and improve project risk management. This is key for the sector. Managing project risks will help ensure projects are delivered to schedule, within budget and reduce costly overruns.

Risk software
With only 40% of the sector making use of dedicated risk management software there is a real opportunity within the sector to start making some positive advancements in terms of risk management.

Risk software helps embed risk management across an organisation. It provides greater visibility of the risks, controls and provides opportunity to determine the most effective and correct level of mitigations. Most enterprise risk management software has a level of automation and can set notifications to act as reminders for risk owners to review and update tasks. This central database of risk information will allow for business decisions to be made with greater confidence and accuracy too.

About JCAD
JCAD provides easy-to-implement and highly effective software for streamlining risk management and claims handling processes in the public and commercial sectors. As a family-owned business, we strive to provide excellent, friendly customer support. Our specialist team works continuously to update and improve our products, ensuring our solutions help clients improve efficiency, increase accuracy and save money.

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