Opportunity Risk

Opportunity (or upside) risk arises from a lack of knowledge, capacity or capability to maximise potential opportunities. As opposed to direct losses, it considers the benefits missed. This would commonly include missed opportunities for funding partnerships or incentives, to develop a submission or have a voice on key policy changes, or to build and contribute to stakeholder relationships that result in early or insightful information channels. Beyond just proactively treating risks, opportunity risk acknowledges the other sides of the same coin.

 Risk indicators include:

• Thought leadership
• Government partnership
• Stakeholder and Government Engagement
• Proactive involvement in emerging policy issues

Organisations are commonly at risk where they rely too heavily on media alerting them to issues or changes rather than having well developed relationships that draw their attention early. Once issues are in the media there is usually an extremely small window in which to contribute sector-specific knowledge or expertise. Even where organisations are involved in formal consultation this is usually late in the policy or regulation development phase and the momentum will already be directed in a particular way.

A lack of proactive opportunity risk management can leave an organisation exposed to decisions that don’t consider the organisation’s specific circumstances. The lack of early issue commentary or engagement will also often mean the organisation is less likely to be seen as a leader and will have a harder time positioning as such into the future.