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Our ERM Journey

In recent years, there has been a regulatory drive in Singapore towards enhanced governance and risk management for public listed companies as well as government agencies. Highly publicized cases such as SLA’s $11.8 million fraud case, AIA insurance scam, NUS’s scientific fraud by its professor, etc further highlight the need for a good risk management system and internal controls to ensure accountability to stakeholders.

On 14 June, 2011, the Corporate Governance Council in Singapore has released a consultation paper on proposed revisions to the Code of Corporate Governance which applies to Singapore listed companies on a “comply or explain” basis. One of the key proposed changes is the greater emphasis of Risk Management as well as the need to look at Risk Management System apart from the previous emphasis on just Internal Controls.

Though National Healthcare Group(NHG) is not required to follow the Singapore Code of Corporate Governance as it is not a listed company, our Board and Senior Management however recognise the value of good risk management as part of corporate governance and have supported and approved the Enterprise Risk Management (ERM) initiative in 2010 for the whole NHG and hence the start of our ERM Journey.

With the endorsement of our Board and Senior Management, we embarked on our ERM Journey in 2010 with the objective of developing an internal process of coordinated risk management that places a greater emphasis on cooperation among institutions, divisions & departments to manage NHG's full range of risks as a whole. This process will include a framework(designed based on ISO 31000 Risk Management Standards) for effectively managing uncertainty, responding to risk and harnessing opportunities as they arise.

The NHG Board Risk Committee (BRC) was formed in January 2011 followed by the formation of Institution Risk Sub-Committee (IRSC) at all our institutions in June 2011. At the 1st BRC Meeting in June 2011, the BRC endorsed the NHG ERM framework as well as ERM policies for use within the Group.

In NHG, the General Policy Statement on ERM is:
“We are committed to effectively managing all kinds of risks that threaten the ability of individual institutions or functions, or the group as a whole, to achieve their objectives, including risks to the safety, health and welfare of staff, patients and others. ERM is an integral part of NHG’s processes and the effective management of risk is fundamental to the achievement of NHG’s Vision, Mission and Core Values. Enterprise-wide risks under our ERM approach involve staff at all levels. Essentially, this means risk management in NHG is seen as the responsibility of the staff at all levels of the organisation “

The NHG ERM Framework outlines the structure & processes which serve to guide NHG towards the effective management of risks. It is designed based on ISO 31000:2009 Risk Management Standards. The key components of the framework are:

Figure 1: NHG ERM Framework

• ERM Value Proposition
• ERM Policy, Mandate & Standards
• ERM Governance Structure
• ERM Approach & Methodology
• ERM Systems & Tools

Together, these key components provide the core basis of how the whole risk management process operates in NHG. The ERM Framework is illustrated at Figure 1.

Click here for Figure 1

Both the endorsed NHG ERM Framework and Policy are available in the ERM intranet.

The endorsed NHG ERM framework and policies were then communicated and made available to all staff in NHG. The respective Appointed Risk Leads and their support staff were also formally trained on the use of ERM framework and application of ERM policies in their day-to-day operations. About 130 of them completed the training in August and September 2011.

With the formal ERM governance structures and framework in place, efforts were then focused on building a culture of managing risk through a host of ERM awareness activities, engagement forums and the enhanced ERM intranet portal for the rest of the FY2011. The awareness activities also gave rise to our very own ERM slogan – “Everyone A Risk Manager”, created by our staff through the cluster-wide ERM slogan contest held in August 2011.

To further create awareness of issues and matters relating to ERM, an initiative to broadcasting newsworthy articles, events and issues on a periodic basis via our 1st ERM eNewsletter, which we named as – “ERM FIT” was launched in August 2011.

The ERM FIT newsletter aims to share on the F-I-T topics which are:

Though we had made much progress since we started in 2010, ERM is dynamic and evolving all the time. Therefore continuous improvement and adaption to organizational changes and environmental challenges is key to our ERM journey going forward. This is also in line with our core value of Professionalism i.e. our commitment to being the best in what we do. With NHG Board and Senior Management setting the tone and with all the support from the staff at all levels, our ERM journey is certainly on track towards a world-class ERM that will place NHG on par with successful organizations in Singapore as well as worldwide.