How To Identify Business Risks?
Identifying business risks is an essential step in ensuring an organisation's safety, compliance and sustainable performance.
By combining proactive methods and reactive approaches, managers can develop a global vision of risks, whether physical, operational, financial or technological.
The Business Value of Early Risk Identification?
In Quebec, risk identification and prevention is a legal obligation governed by the Occupational Health and Safety Act and supervised by the CNESST. Every employer has a duty to identify, evaluate and control the hazards present in their workplace, in order to ensure the safety and health of their employees.
This responsibility does not rest solely with management, but must be shared between managers, supervisors and workers. Involving everyone promotes a better understanding of the real risks in the field and strengthens the prevention culture within the organisation.
By also integrating external partners (suppliers, subcontractors, consultants), the company is creating a safer working environment that complies with regulatory requirements.
The Main Types of Risks Businesses Need to Monitor
Every organisation, whatever its size or sector of activity, is exposed to a variety of risks that can compromise its performance, compliance or reputation. Identifying these risks as a whole enables you to build up a complete and realistic map of your vulnerabilities so that you can take effective action before an incident occurs.
1. Physical and occupational health and safety (OHS) risks
These risks directly concern employee safety and compliance with CNESST requirements. They include falls, injuries, musculoskeletal disorders, exposure to hazardous products and the use of unsafe equipment.
Rigorous prevention, combined with regular inspections and ongoing training, can considerably reduce workplace accidents and production stoppages.
2. Operational risk
Operational risks affect the day-to-day running of a company. They include human error, process breakdowns, equipment failures, quality defects and poor planning.
They can lead to financial losses, delays and reduced customer satisfaction. Clear documentation of procedures and adequate supervision can limit these failures.
3. Financial risks
They concern the management and economic stability of the company. This includes internal or external fraud, cash flow fluctuations, poor cost management or tax non-compliance.
Rigorous financial management, backed by strong internal controls and professional support, helps prevent losses and ensure long-term profitability.
4. Technological risks
In a context of increasing digitalisation, the risks associated with information technology (IT) are becoming ever more critical. These include cyber-attacks, data loss or theft, server breakdowns and non-compliance with privacy laws.
Implementing IT security protocols, regular back-ups and raising employee awareness of cyber security are essential to protecting digital assets.
5. HR and organisational risks
These risks stem from human and structural factors. We're talking here about high staff turnover, burnout, a deteriorating working climate, lack of training or succession planning. They have a direct impact on motivation, productivity and team cohesion.
Proactive human resources management, supported by clear internal policies, ensures a healthy, high-performance working environment.
6. Reputational and regulatory risks
They concern public perception and the company's legal compliance. Poor communication, an environmental incident or regulatory non-compliance can seriously damage reputation and lead to sanctions.
Rigorous governance, increased transparency and constant regulatory monitoring help to protect the credibility and legitimacy of the organisation over the long term.
Proactive Approaches to Risk Identification
Effective risk management requires a proactive approach. This means identifying hazards and vulnerabilities before they cause an incident.
Inspections, audits and task analyses
Regular inspections of workplaces and processes are the first line of defence against risks. They enable anomalies to be identified quickly and dangerous situations to be rectified before they escalate.
For an effective approach, we recommend :
Carry out planned field visits in all departments.
Use standardised inspection grids to ensure consistency.
Systematically document findings and corrective actions.
Check compliance with CNESST requirements and internal policies.
Task analysis involves examining critical operations in detail in order to identify :
Possible human errors;
Unsuitable or faulty equipment;
Unsafe working conditions.
Finally, internal audits guarantee the rigour and traceability of the approach, validating that the company complies with safety standards, applicable regulations and its own procedures.
Employee consultation and participation
Employees are often the best observers of real risks in the field. By consulting them, we can gain a better understanding of risk situations and strengthen their commitment to a culture of prevention.
A few best practices:
Organise individual interviews or group brainstorming sessions;
Set up an anonymous reporting mechanism to encourage transparency;
Create active health and safety committees involving all teams.
All observations must then be centralised in a shared risk register, making it easier to monitor, prioritise and plan corrective actions.
Analysis of existing documentation
Documentary analysis complements field observations by providing a global view of internal processes and hidden risks. It consists of examining procedures, reports, audits and safety assessments to detect :
Inconsistencies or omissions in processes;
Areas not covered by existing controls;
Gaps between theory and practice in the field.
It is also useful to look at financial and operational data to spot weak signals, such as :
Late deliveries or high error rates;
Recurring budget variances;
Frequent customer complaints.
By cross-referencing these analyses with inspection findings and employee feedback, the company obtains a precise, dynamic and prioritised map of its risks.
Reactive methods: learning from past incidents
Even with the best prevention practices, no working environment is completely risk-free. That's why we recommend you adopt a reactive approach, which aims to learn from past events to prevent them from happening again.
Analysis of accidents, incidents and near misses
Every incident, whether or not it results in injury, is a valuable source of information. Systematic analysis of accidents, incidents and near misses enables us to identify the root causes, whether human, organisational or technical.
These internal investigations provide a concrete understanding of process failures and facilitate the implementation of targeted preventive measures.
Compilation of reports and monitoring data
First aid reports, work stoppages and complaints sent to the CNESST must be recorded and analysed regularly. When centralised, this data can be used to identify recurring trends (types of injury, places at risk, critical periods) and adjust action plans accordingly.
Particular attention must also be paid to feedback from employees, who often provide valuable information on risky behaviour or shortcomings in procedures.
Implementation of corrective measures and ongoing monitoring
Once the causes have been identified, clear and measurable corrective measures need to be defined: modifying procedures, improving equipment, training employees or reviewing internal controls.
The creation of a centralised register of incidents and corrective measures makes it easier to monitor the effectiveness of the actions taken and fosters a culture of continuous improvement.
Mapping and prioritising risks
Once the risks have been identified, you need to structure and prioritise them. Mapping and prioritisation enable you to clearly visualise the threats to your organisation, measure their potential impact and focus your efforts on the most critical issues.
Risk mapping
Risk mapping is a visual tool used to represent the various risks according to their nature, origin or area of impact. It can be built by process, by department, or by operating site, depending on the company's structure.
This exercise helps to highlight the links between risks (for example, a technological risk can lead to a financial or reputational risk) and to better understand their cascading effects.
The probability and severity matrix
The risk matrix completes the risk map by allowing each risk to be assessed according to two criteria:
Probability of occurrence: how often is the risk likely to occur?
Seriousness: what would be the impact on employees, operations or the company's finances?
Each risk is then classified according to a level of importance: minor, moderate, major or critical.
This prioritisation helps to prioritise the actions to be taken, to define what is urgent and to allocate resources in the best possible way.
Defining an action plan
Once the risks have been assessed, it's time to take action. Each priority risk must be assigned a manager and a corrective action plan with precise deadlines.
The action plan may include training staff, updating procedures, reviewing equipment or improving internal controls.
Regular updating of the matrix and mapping remains essential, as risks change with the economic, technological and human context.
Integrating Risk Management into Sustainable Performance Strategies
Identifying and understanding your risks means investing in the stability, confidence and growth of your organisation. A business that is proactive in its risk management is better prepared, more agile and more resilient to the unexpected.
With a structured approach, proven tools and the expertise of Mallette advisors, you can turn prevention into a real strategic asset, protecting your employees, your assets and your reputation.
Communicate with our risk management experts today to plan your risk diagnostic and build a stronger, safer organisation.