14. Manage Risks

  1. Charles K. Coe

Published Online: 21 MAR 2012

DOI: 10.1002/9781118386064.ch14

Nonprofit Financial Management: A Practical Guide

Nonprofit Financial Management: A Practical Guide

How to Cite

Coe, C. K. (2011) Manage Risks, in Nonprofit Financial Management: A Practical Guide, John Wiley & Sons, Inc., Hoboken, NJ, USA. doi: 10.1002/9781118386064.ch14

Publication History

  1. Published Online: 21 MAR 2012
  2. Published Print: 13 JUN 2011

ISBN Information

Print ISBN: 9781118011324

Online ISBN: 9781118386064

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Keywords:

  • nonprofits;
  • risk assumption;
  • risk elimination;
  • risk management;
  • risk reduction;
  • risk transfer

Summary

Nonprofits face the risk of loss due to accidents, fire, and theft. An effective risk management program produces a safe working environment, fewer accidents, lower insurance costs, increased productivity, and higher employee morale. The CEO should assign responsibility for the risk management program to a senior manager, typically the CFO. Some nonprofits also form a risk management committee to assist the risk manager. Risk management is a three-step process: 1. Identify the risk. 2. Treat the risk. 3. Administer the program. This chapter discusses the four risk-treatment options: risk elimination, risk reduction, risk assumption, and risk transfer. The risk manager administers the risk management program. Risk management includes the following duties: record policies and correspondence, investigate and report incidents, review contracts, handle claims, litigate claims, and evaluate performance.

Controlled Vocabulary Terms

Nonprofit organization; risk management