What is a risk assessment?

Unforeseen circumstances are just that, but unpredictable events don’t have to scupper business plans or leave you financially exposed. A good risk assessment can help you prepare for hazards and minimise losses.

To help your business stay resilient, we look at the role risk assessments play in your overall risk management strategy and why overlooking their importance can leave your business vulnerable.

What’s the point of a risk assessment?

Risk assessments help you identify and analyse risks to your business, with the aim of preventing or minimising damaging consequences.

Risks can be anything that threaten the smooth running of your organisation. They can impact all aspects of your business, for example, its assets, earnings, or operational efficiency. It can also include incidents that affect your employees.

The importance of risk management

Good risk management can help reduce business disruption, legal costs, and damage to your business’ reputation.

Sadly, risk assessment often has the reputation of being a time-consuming burden, but understanding what the risks are is the first step to preventing them.

On a practical level, risk assessments can prevent injuries, improve workplace safety, and enable your business to meet health and safety rules. A comprehensive risk assessment can also lower your insurance premiums.

What is the risk assessment process?

To put an effective risk assessment in place, you’ll need to:

Identify hazards

A hazard is anything that could negatively affect your business or stop it from operating altogether.

Consider where those risks might come from and who or what they might affect. Risks to look for include:

Operational activities
Employees
Contractors
Visitors or members of the public

Assess the risk

Analyse the likelihood (risk) that those hazards might affect your business immediately, in the short, medium and long-term.

It isn’t possible to assess and control every risk in the workplace. These are known as acceptable risks, where the cost of protecting against them would be more than the cost of them happening.

Some risks are classed as ‘one-in-a-million risks’, where the consequences may be serious but the likelihood of them happening is minuscule.

Bear in mind that accurate risk assessments can be subjective. It’s worth considering different opinions before deciding whether something should be acted on.

Control the risks (control measures)

Control measures are what you can do to minimise or prevent the risk from happening. They’re usually grouped into five areas:

Elimination – removing potential risks completely. For example, replacing damaged equipment.
Reduction – how you can reduce a risk if it cannot be eliminated. For example, training staff if they work at height or with hazardous substances.
Reduction – how you can reduce a risk if it cannot be eliminated. For example, training staff if they work at height or with hazardous substances.
Safe systems of work (SSOW) – this is about putting safe working methods in place; it could be as simple as making sure only adequately trained staff carry out specific tasks.
Safe systems of work (SSOW) – this is about putting safe working methods in place; it could be as simple as making sure only adequately trained staff carry out specific tasks.

Record your findings

According to HSE guidelines, if you’ve got more than five employees, you’ll need to record any significant findings (you can find templates on the HSE website). This includes any hazards, who they might affect (and how), and what you can do to prevent or control the risk.

Review and update

You should regularly review and update your risk assessment to check it’s still fit for purpose.

It’s also worth reviewing your risk assessment if your business structure or activities change. For example, if you increase your workforce, expand business operations, or move to new premises.

How are risks analysed?

There are several different ways to approach risk assessments:

Qualitative assessment

This is an assessment based on judgement. Typically, the person identifying and analysing hazards will be experienced and have expertise within their industry.

Qualitative assessments usually label each risk based on the likelihood of something happening and its severity.

Quantitative assessment

This is where risks are prioritised according to specific data (rather than based on experience and judgement).

For example, when a hazard is identified and analysed, it will be given a number based on the likelihood of it happening, and its severity.

Quantitative assessments are generally used in industries where risk must be carefully reviewed, such as manufacturing, or where chemicals are involved.

Generic assessment

This type of assessment applies to everyday workplace activities. This could include display screen equipment (DSE) risk assessments, accessibility, fire exits, or electrical equipment.

Site-specific assessment

This is where your assessment needs to consider any specific circumstances. This could depend on location, the immediate environment, or the equipment used at the site.

For example, if you’re overseeing two or three building sites, each one might start with a generic assessment as there will be similar risks across them all. However, one site might be close to a busy road and need a specific assessment to manage the site and regular traffic.

Dynamic assessment

Dynamic assessments happen on-site and often in real-time. This typically applies to emergency situations or where hazards are unpredictable.

What are the different types of risk assessment?

Some industries will have specific legislation, which may include certain risk assessment standards or templates you need to follow. This could include the Control of Substances Hazardous to Health Regulations or the Control of Vibration at Work Regulations 2005.

Otherwise, risks will vary depending on the type of business you run and the activities carried out. One example is engineering, where machinery and equipment will need to be inspected for safety.

More general risk assessments that are likely to apply to most businesses, include:

Fire risk assessment
Manual handling risk assessment
Young person risk assessment
Display screen equipment (DSE) risk assessment

Who can carry out a risk assessment?

Employers are ultimately responsible for the safety of their employees. But anyone can be tasked with carrying out a risk assessment, so long as they’re considered a ‘competent person’ with sufficient knowledge about the area they’re assessing.

If you delegate the task, it may be worth regularly changing who undertakes the assessment. A fresh pair of eyes may spot new hazards, making your risk assessment more robust.

Is risk assessment a legal requirement?

In the UK, the Management of Health and Safety at Work Regulations states that any employer or self-employed person must carry out an adequate risk assessment.

If you employ fewer than five people, you don’t have to keep documentation, but you will need to be able to prove that health and safety procedures are in place. With that in mind, it’s useful to keep documented evidence.

It is especially important to take appropriate fire safety measures and adhere to any specific control measures required by law (such as working with particular machinery, chemicals, electricity, or at height).

Supporting your business and managing risk

Risk assessments are intrinsic to any risk management strategy, helping you prevent or mitigate damaging consequences to your business.

Remember that some industries will have recommended procedures and legislation to follow. For many other businesses, there won’t be specific procedures detailing how assessments should be carried out.

What’s important is that you follow each step (identify hazards, analyse risk, set out control measures, review and update).

Need help with your risk management?

If you’d like further guidance on carrying out thorough risk assessments, we offer a risk management service. We can also support industry-specific needs with our engineering inspection services. Speak to our team to find out more.

Speak to us: 01603 967900

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