Enterprise Risk Management

Risk is a powerful driver of sustainability efforts. Reputational risks/benefits, customer demand, stakeholder expectations and operational risks/benefits are the main drivers that will determine Air Selangor’s sustainability initiatives moving forward. Sustainability performance will provide a strong indication of how successfully it is mitigating risks and achieving resilience. The need to mitigate reputational and operational risks is clearly the underlying catalyst fueling many sustainability initiatives. It is worth noting that corporate sustainability in Air Selangor is not the only vehicle to reduce risks, but a vehicle among many (e.g. HSE management, operational management, regulatory compliance etc). The convergence of risk management and sustainability in Air Selangor will ensure there is greater collaboration between both functions and actively seek for synergies that will create the most benefits.

 

The Head of Risk Management Department oversees five (5) sections i.e. sustainable development, risk management, business continuity management, ISO governance and integrity sections. Each section is led by a Head of Section.

The Head of Risk Management Department reports directly to the Chief Executive Officer (CEO), who is also the Chairman of the risk management committee. The risk management committee comprises all Head of Departments (HODs) in Air Selangor. The committee meets at least once per quarter to discuss, update and provide feedback on risks that may affect the business operations of Air Selangor. The committee will assist the HODs to ensure risk management is adequately carried out, as part of its responsibility in evaluating and making key strategic and operational decisions.

Risk Management

Air Selangor’s Risk Management Policy is the starting point in the Enterprise Risk Management Framework and has been prepared to ensure that risk management becomes the concern of everyone and that risk practices are internalised and applied consistently across Air Selangor. The Policy prescribes a comprehensive risk management approach, broad guidelines and other parameters & tools used in identifying and assessing risks, and a supporting risk management methodology for controlling, monitoring and reporting risks that Air Selangor will face in the conduct of its operations.

The top 10 risk factors of Air Selangor as at 17 August 2020 are as follows: -

1 Cash Flow 6 Health & Safety
2 Regulatory Compliance 7 Non-Revenue Water
3 Raw Water Pollution 8 Revenue Collection
4 Ability to Meet Future Demand 9 Reputation
5 Asset Management 10 Ability to Treat Water

The Board and Senior management of Air Selangor will monitor the effectiveness of risk management activities across the Air Selangor to ensure that these activities continue to support the mission, vision and strategic objectives. Air Selangor’s Risk Management structure consists of three lines of defence, as per the diagram below: -

1st
Daily Risk Management
Business/ Functional Units/ Projects

Risk Ownership

Effective Internal Controls

Useful Risk Management reports for decision making

Risk-based KPIs

2nd
Risk Management
Risk Management

Risk Advisory

Risk Training

Risk Monitoring

Regulatory compliance

3rd
Independent Assurance
Board of Directors

Internal Audit

Investigations

Integrity

Air Selangor established the Integrity Section under Risk Management Department in September 2019. This is in line with the Prime Minister’s Directive, Series 1 No 1 of 2018 - The Establishment of Integrity and Governance Unit in Government-Linked Companies (GLCs), and State and Ministry-owned Companies, and as part of SPAN’s Integrity framework. The purpose of this Section is to ensure the practice of excellent work culture among employees, underpinned by strong morals and ethics. The aim of this initiative is to curb potential offences of corruption, abuse of power and malpractice in Air Selangor.  The Integrity Section is tasked to carry out four core functions, which are:

  1. Complaints Management
  2. Detection and Verification
  3. Integrity Enhancement
  4. Governance

Head of Integrity Section reports functionally to the Board Audit Committee (BAC) and administratively to Head of Risk Management Department, who reports directly to the Chief Executive Officer (CEO). Air Selangor aspires to conduct our business with the highest standards of integrity. If you have details of any improper conduct committed or is about to be committed by Air Selangor’s employees, business partners or other stakeholder, please report it to us.

 

Business Continuity Management

The Business Continuity Management (BCM) Section under the Risk Management Department has been officially established on 1 May 2020. The approved BCM framework dictates the function of the BCM Section i.e. to develop, establish and implement BCM Programme in Air Selangor and ensure Air Selangor is capable of responding to disaster/crisis situations and resume/continue its business and operation within the stipulated time. This includes ensuring the availability of robust plans to protect the interest of the organisation, customers and other stakeholders. The policy covers among others the BCM Governance Structure, BCM Culture and BCM Lifecycle Methodology mirroring the ISO 22301:2012 standard.

Air Selangor’s BCM Programme shall effectively manage human capital, business & reputation, effective crisis responses and minimise operational impact. Our Emergency Response Plan (ERP) and Disaster Recovery Plan (DRP) outlines how we will continue operating during an unplanned and planned disruption in service. Below are the processes that the BCM Section undertakes to implement an effective BCM Programme in Air Selangor: -

 

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ISO Governance (ISOG)

ISO Governance Section (ISOG) was established to create a focal point for all ISO initiatives in Pengurusan Air Selangor Sdn Bhd and acts as the single point of reference for the Chief Executive Officer (CEO) and Head of Risk Management Department (HRMD) in order to improve efficiency and quality of the Management Systems implemented across Air Selangor. ISOG assumes the role of Management Representative and advisor for all ISO initiatives across Air Selangor to ensure the ISO compliances and certification in Air Selangor are well maintained. As the owner of ISO 9001 Quality Management System (QMS), ISOG are responsible for coordinating the ISO 9001 implementation, collaborate with relevant departments to improve the effectiveness and streamline the ISO implementation and provide relevant ISO awareness and trainings for employees in Air Selangor.

ISOG is also responsible to supervise and review the effectiveness of ISO Internal Audits and provide recommendations for improvements, conduct Management Review for all Management System in Air Selangor, coordinating all on-going ISO re-certification activities, set up and maintain documentation management system/process and ensures ISO policies and applicable documents are properly disseminated, communicated, understood and evaluated to ensure continuous improvement.