The Risk-Based Approach
Within the Integrated Approach, we use our best practice model - The Risk-Based Approach - to assess and address risk by frequency and severity of occurrence.
There is no one-size-fits-all approach to dealing with risks. It is not practical to address all risks with the same level of intensity considering the limited resources enterprises have.
DuPont Sustainable Solutions (DSS) advocates a differentiated risk approach that ensures that appropriate effort and resources are expended based on the specific risk profile of the industry and business a company is in, resulting not just in the desired end state but ensuring value for investment.
Organizations must define their risk appetite in a way that takes into account the protection of people, assets, environment and business implications Risk governance is defined in a way that takes all of this, as well as regulatory requirements, insurance and stakeholder’s considerations, into account.
Once the risk tolerance is defined, a framework for managing risks should be developed that clearly defines proportionate control mechanisms. The concept of proportionality is vital; the allocation of resources must not be equal or democratic, but rather deployed to reap maximum benefit in terms of risk reduction.