It’s commonly accepted that development programmes have a high level of financial risk, meaning that funds are not properly accounted for, not used for the purposes intended and do not represent value for money. In other words, less money is reaching the beneficiary than could be.
Taking the right steps towards monitoring the risk in aid and development programmes is key, for example, ensuring that there are adequate risk assessments in place, and it is only by taking these steps that financial risk can be managed or reduced, and confidence increased that development funds are achieving the right level of impact.
Responding strategically to reducing financial risk - what should you consider?
Many organisations have yet to find an effective way to manage their programmes with an effective risk management approach. A balance will need to be achieved between the effort put into programme delivery and that put into the controls around it. However, it is only through a proper understanding and management of financial risk that aid and development programmes can hope to achieve optimal impact.To find out more about how to manage financial risks in funding and understand how risk assessments can work, please download the Soundbite above.