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Refining Risk Based Regulation

This week we ran a workshop for a large federal regulator who is facing the challenges of significant change driven internally and externally. Changes in legislation and independent reviews of the activities of players in the industry has driven increased media interest resulting in substantial increases in their reported complaints to manage. Internally, a change in the compliance and enforcement approach and the pressures of resourcing the rapidly growing demand for services across the organisation has meant that a review of their regulatory strategy and processes are now required.
This experience is not unusual for many regulators around Australia, and in fact, in many Western democracies where stakeholder expectations of government agencies who have a role in protecting the community are (and many would say, quite appropriately!) high. This environment can put organisations at considerable risk and requires a structured approach to recalibrating and reassessing strategies at all levels in the face of these types of changes to their operating environment.
Australian public sector use a “risk based regulation model” and in that lies the inherent issue. In periods of particularly stretched human and physical resources, which is the experience of our Agency this week, risk based regulation is only as good as your ability to identify, prioritise and manage the contemporary risks!
It becomes critical that resources are expended on the basis of:

1. Being able to accurately identify what activity or industry behaviour presents the most significant risks
2. Ensuring there are robust processes on which to base triage and case prioritisation decisions
3. carefully considering what is the most effective regulatory strategy response in the current climate that acknowledges the operating constraints.
4. Regular evaluation of the model

As we have done with other agencies facing similar situations, through discussion and the use of evidence based data, the focus was on refining risk parameters and processes and objectively evaluating the approaches to proactively and positively with the changed circumstances in a matter commensurate with both internal and external stakeholder expectations.
If we can assist your agency to review current regulatory processes, please get in touch at

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