CASE STUDY 4
Development of a Typical Risk Statementto Shareholders
The theoretical model for performing risk management, as described here, consists of risk identification, analysis, and response and the application of this model in the construction of a risk register for UUU. As this is a largely qualitative analysis due to lack of project level information, there will be more risks listed at the corporate level and fewer at the project level. A risk statement to shareholders is developed based on a summary of typical risks at each level of the corporation.
17.2 UUU OVERVIEW AND RISK REGISTER
UUU is a corporation which deals with heating and air conditioning systems, aerospace and industrial systems, elevators and escalators, aircraft engines, helicopters, fire and security protection services, and power systems. It has over 3000 locations in 52 countries and conducts business in 120 countries. Figure 17.1
gives a brief overview of the organization levels.
17.3 CORPORATE RISK REGISTER
The corporate risk register deals with the macro-level risks that have the largest impacts on the organization. Although these risks may not be prominent for each individual project, they are risks because of the cumulative effects they can have on the corporation.
17.3.1 Foreign Exchange Risk
UUU’s involvement in the world economy has grown tremendously as its share of domestic revenues has declined relative to its European and East Asian revenues. UUU has a large ...