ISO 31000: Risk management for businesses

ISO 31000 is a key risk management framework that’s adopted in more than 180 countries worldwide. With ISO 31000, organizations can identify, evaluate, and address potential threats before they become major issues, allowing them to adapt and thrive in an ever-changing business environment.

This guide explores the principles and practices of ISO 31000, offering actionable insights and practical tips for implementing its framework. Whether you’re looking to understand how ISO 31000 compares to other standards or seeking strategies to integrate it into daily operations, this guide has you covered.

What is the new ISO 31000:2018 Standard?

The New ISO 31000:2018 standard is a revised version to improve implementation in companies. These are the four most important improvements to ISO 31000:2018.

Interdisciplinary approach

The new ISO 31000:2018 norm focuses on an integral approach that is based on general risk management instead of the old method of focussing on a specific aspect, such as quality, safety, health, or environment. In this way, the standard provides the company with an optimization process as a whole instead of a specific aspect of it.

Leadership

Again, the new norm especially focuses on the management’s competence to establish risk management throughout all areas of their company. This helps to ensure continuous improvement of risk evaluation and corrective action.

Systematic management

The most thorough method of risk management, according to DIN ISO 31000, is a strategic, organizational approach of identifying, analyzing, and categorizing risks. It deals with questions, such as:

1. Where do risks occur?
2. How do they affect certain aspects of the company?
3. Which priorities need to be established in order to minimize said risk?

For more efficient risk management, you can use any of our pre-made checklist templates that cover all industries. 

What are the 6 principles of ISO 31000 risk management?

The following principles illustrate the high importance of having a risk management system. They also provide important hints and tips on the design and structure of a management system.

1. The ISO 31000 certification ensures that you achieve your business goals.
2. It is important to implement the risk management system in all relevant areas.
3. A stable corporate structure is essential for ISO 3100 certification.
4. Available and transparent data is essential for a functioning risk management system.
5. All persons involved should have full insight into the risk management system.
6. Continuous improvement and adaptation to new standards and circumstances are very important to the health and function of your risk management team.

How can my company get an ISO certification?

Let’s be clear, an ISO 31000 framework is not used for an ISO certification, but it is a guide that can help you prepare for one. The four steps for successful ISO certification are based on the principles just described. 

Before a risk management matrix can be successfully introduced, the company’s internal and external structure should be fully developed. This just means that various employee responsibilities should be clearly defined in both the backend and frontend of the company. Once these points have been made clear to everyone, you can follow these three steps:

1. Implementation

This is by far probably the most difficult step of the whole process because of the sheer amount of work required to appropriately address any workplace safety concerns. Here, every single occupational risk and hazard present in the office or on the worksite that employees have the potential to come in contact with must be identified and documented.

Depending on the line of work you specialize in, this could be as simple as listing the ergonomic hazards of a sedentary office lifestyle or as complicated as listing every physical, chemical, and biological danger to ensure construction site safety.

This may sound overwhelming at first, but don’t worry, there are online resources and tools to help give you an idea of what needs to be recorded, such as a risk assessment template, so you don’t have to start from scratch.

Although the ‘Implementation step’ is the hardest, it is also the most important because it will help your company anticipate and put an end to any career-ending events that have a tendency to rear their ugly, little heads when least expected.

2. Evaluation

After you determine how much resources, personnel, and the time it will take to mitigate certain risks, you can then move on to step two: evaluation. This is where you’re going to assess the success of the implementation process. Did you need more resources to effectively contain workplace hazards? How long did it take to appraise the risks? Are there strategies you can use to make the process more efficient? How about safer? Answering these questions will be essential for your success in the next step.

3. Improvement

This bullet point should hardly come as a surprise since continuous optimization is the objective of every business operation. In this step, you’ll take a look at the data collected in your evaluation and analyze it for improvement. Were there any injuries in the last x-number of days? If so, what remedial measures can you implement so the same or similar circumstances that caused an injury doesn’t happen again? This might mean looking at incident reports, attendance sheets, or a product non-conformance sheet for any chinks in the armor.

How much does an ISO certification cost?

Now, this is a business expenditure, after all, so let’s talk numbers. On average, an ISO 90001 certification can cost anywhere from $6,000-$50,000 (depending on your company’s size, preparation time, and package). Yes, this is a costly certification, but it is also an investment. A certification in any of the ISO sectors will give your company an edge over your competition as having an internationally recognized standard for risk management, quality management, environmental management, etc.

The great thing about the ISO 31000 is that you don’t need to spend exorbitant amounts of money to get the same results as an official ISO certification, although there are still many benefits of getting certified. It’s as cheap as the free checklists on the Lumiform app.

How long does an ISO certification take?

On average, an ISO certification takes about 4 months to complete. However, depending on the size of the company, this variable is subject to change. If you’re thinking about getting certified, then it’s advisable to plan for the higher end of the estimate, so there’s still plenty of time to get your books in order. 

Best practices for ISO 31000 compliance

Organizations that excel in risk management do so by embedding its principles deeply into their culture and operational processes. Below are specific best practices to help your organization stay compliant with ISO 31000:

Build a risk-aware culture

Creating a culture that prioritizes risk management is fundamental to ISO 31000 compliance. Encourage open communication about risks across all levels. Employees should feel comfortable reporting potential issues without fear of blame or retribution.

It’s also essential to provide regular training sessions. These sessions should not only introduce the principles of risk management but also show how they’re relevant to employees’ day-to-day responsibilities. Clearly define roles and responsibilities too in your risk management framework, with specific tasks for team members.

Make risk management part of operational processes

Risk management should never be treated as a separate or periodic activity. For true compliance with ISO 31000, it must be integrated into the operational fabric of the organization. One practical way to achieve this is by adding risk assessments to routine workflows. For example, manufacturers can incorporate these assessments into regular equipment audits, making sure that machines are inspected for potential failures during standard maintenance checks.

Use data to refine controls

Data is one of the most powerful tools for improving risk management. By analyzing trends and patterns in collected data, you can refine your risk controls and address recurring issues more effectively.

Review submissions from inspection forms or incident reports. You can then analyze trends by factors such as location, time, or process. For adjusting controls, you might update safety measures, revise inspection schedules, or implement new training programs for areas flagged as high-risk.

Lumiform as your digital risk management tool

With a digital checklist for ISO 31000 certification, you can easily carry out a risk inspection via tablet or smartphone – online or offline. And with the desktop version, you can create customized checklists and evaluate the collected data. Lumiform also offers tools for many ISO certifications, including checklist templates for ISO 31000, ISO 45001, and ISO 9001. 

Lumiform offers businesses an easier solution to keeping up with the mounting legal documentation requirements. Better yet, you can do all of this on the fly with the mobile app via a smartphone or tablet. Lumiform does all the work by guiding employees through a simplified auditing process. Clean, transparent documentation frees up time and saves on legal fees and fines.

Other advantages of a digital solution:

• Continuously increase quality and safety: Through the flexible checklist construction kit, you can constantly optimize internal inspections and processes. Lumiform guides the auditor through the audit, so there is no need for training.
• In addition, we offer more than 12,000 ready-made templates to help companies get started digitally in no time.
• The very simple operation offers no room for errors for auditors on-site. The app offers an easier solution to documenting or filling out checklists than tedious paper or Excel sheets.
• All results, images, and comments are automatically bundled in a digital report.