Not all risk treatment strategies will be relevant for every risk or uncertainty.

When selecting which risk control method there are a few factors that need to be taken into account to ensure the right treatment method is implemented.

• The balance between risk severity and cost.
• Possible opportunities and upside risk.
• Compliance with governmental policy and law.
• Existing Controls.

Balance between risk  severity and implementation cost

Risk funds need to be allocated on a priority basis. There is no reason for an organisation to spend substantial amounts on a low priority risk as the impacts of its outcome might be low or it may never happen.  This also applies for the opposing scenario where we do not want to spend too little on a critical risk.

Possible opportunities

Organisations cannot operate or survive by avoiding all risk. For them to succeed, risks need to be taken to allow opportunities to arise. Therefore we must take into consideration the ‘upside risk’ of certain activities and aim to implement controls that maximise desirable activity, not completely remove all risks.

Compliance

Particularly in Health and Safety Risk Management there are risks that are required to be controlled to comply with laws and policies. This should be taken into account when deciding on a risk strategy as it may limit our options (e.g. we may be forced to act, removing the ‘avoid’ or ‘accept’ the risk options).

Existing controls

If existing controls are already implemented, the organisation should focus on improving its effectiveness before implementing new costly measures.