Regulatory Risks Essay

Risks are inherent to all cable organizations. Risk patchagement often considers several areas of pr strikeice and is an absolute necessity, not merely an option. The root pass on discuss regulatory risks for organizations, and explain how they nookie be identified and managed. Risk management requires considering and weighing risks and implementing procedures to monitor and moderate them.Risk IdentificationOverview legislative and executive branches of the United States administration run through enacted laws that regulate all blood linees.Thousands of administrative agencies are authorized by Congress to administer and enforce statutes by regulate businesses. Administrative agencies are typically given executive power to investigate and prosecute potential infringement of statutes, administrative rules, and administrative orders (Cheeseman, 2010). Intentional Torts, Negligence, and Liability turn no organizations risks are identical to anothers, several can be identified and applied to organizations in general. There are common chord categories of wrong intentional torts, unintentional torts, and strict liability.Intentional tort. This category of wrong requires that intent was present when harm was caused. Examples of intentional torts are assault, battery, and false imprisonment. The law safeguards individuals from uninvited touching, restraint, and any other contact (Cheeseman, 2010). Unintentional tort. Negligence is the omission to do something which is a reasonable man would do, or doing something which a prudent and reasonable man would not do (Cheeseman, 2010, p. 80).For a legitimate negligence lawsuit, several elements of negligence mustiness be present duty of care, reached duty, injury, act was the actual cause of injuries, and the lax act was the legal cause of the injuries. Strict liability. Even if an individual was not negligent and had no intent, he can still be held legally apt(p) for injuries caused by certain activities. Stric t liability imposes legal responsibility for injuries sustained in the following product liability, ultra-hazardous activities, animal care, and some statutory offenses (Butera, Beausang, Cohen, & Brennan, 2011).Disclosure of internal representation ActionsTo prevent public perception of secrecy, Congress has allowed statutes to promote public disclosure of federal administrative agency actions, while at the same time defend companies from overly public administrative agency actions. These statutes are the granting immunity of In figure of speechation Act, the Government in the Sunshine Act, the Equal Access to Justice Act, and the Privacy Act. Freedom of information act. This federal law allocates for full or limited disclosure of formerly unreleased information and documents. This law guarantee public access to government records and commits a presumption of disclosure.However, there are nine exemptions of the act. Government in the sunshine act. This law allows closed or part ially closed advisory perpetration meetings. Closed or partially closed to the public are discussions of classified information, reviews of proprietary data, and deliberations that consider personnel privacy. Equal Access to Justice Act. A ships company who is subject to an action of an unjustified administrative agency can sue to recover attorneys costs and other fees (Cornell University Law School, n. d. ).Privacy Act.This act safe-keep records that ca be recovered from a system of records by personal identifiers like name or social security number. An individual can have access to his records and request correction if they are incomplete or inaccurate (Social Security Administration, 2011). Risk Management The Industrial Revolution caused substantial environmental defilement of solid and toxic wastes into the land and water. Companies such(prenominal) as Alumina, Inc. , were not efficient in voluntary pollution fancy, so the government took on its regulation and control (Chees eman, 2010).Awareness of and compliance to these regulatory statutes may be the beaver risk management strategy available to companies who are at potential risk. Risk estimate and compliance are managed in together with one another. Compliance management includes three interrelated perspectives preventive, detective, and corrective procedures. 80% of organizations report improvements from expanding their compliance regimens (BPM Forum, 2006). Preventive The easiest, close to fiscally sound, fastest air to solve a problem is to prevent the problem in the first place.The best risk preventive practice for agencies such as Alumina, Inc is regulatory compliance. The government places a high level of importance on the preservation of the environment and has stringent means of enforcing compliance to environmental regulation. The best approach for achieving compliance, thus minimizing regulatory risk, is to have a preventative focus. Congress created the Environmental Protection Agency in 1970 as a rule-making agency to hold hearings, make decisions, and order remedies for violations of environmental laws. Air and water quality standards are established that regulate pollution rates.If companies were compliant with enacted statutes at all times of business operations, such measures would prevent regulatory risks. Although Section 5 of the FTC Act prohibits unfair and deceptive practices, some companies are in violation. Part of preventive risk management, companies must avoid misleading or omitting information. Unsubstantiated claims and bait and switch tactics must be avoided as a preventive measure. Insurance, which is governed by the law of contracts, is knowing for businesses to protect themselves against risk of loss.The law requires some companies to carry a minimum of $1 million of liability insurance, which will cover negligence, wrongful acts, and misconduct by the company (Cheeseman, 2010). Liability insurance will guarantee injured third parties compe nsation. This measure is both preventive and corrective. Detective Compliance evaluation inspections and audits will not serve as a preventive measure however serve to detect possible risks and is an after-the-fact approach. Compliance is defined as ensuring business procedures, operations, and practices are in concord with a given set of norms (Sadiq & Governatori, 2010).Detective measures are based on reporting and conducting internal and external audits. Changing legislatures and compliance requirements make it arduous to detect. The diversity, scale and complexity of compliance requirements warrant a highly systematic and well-grounded approach, (Lu, Sadiq, & Governatori, 2008, p. 345). Corrective Measures Organizations can raise several defenses as corrective measures against liability. piece maintaining public image and damage control, defenses must be ethical in resolving potentially damaging lawsuits. Alternative Dispute Resolution.Negotiation is a easy form of alternativ e dispute resolution, and includes only the parties involved in the dispute. Negotiation is resolved when the parties reach a voluntary resolution. Mediation is another popular form of alternative dispute resolution. It is available through individuals and organizations like the American Arbitration Association and some court systems. Alternative dispute resolution is an attractive way to resolve disputes because of its speed and the empowerment of the involved parties. Court litigation is slow, expensive, and has uncertain results.Organizations can hold back sensitive business information from public dissemination. This will protect the disclosure of information that could hurt foreign policy or national defense, privacy of individuals, proprietary interests of business, functioning of the government, and other interests (HRSA, 2011). Corrective measures vary from the commencement of a new regulation, to breech reporting, to the company coming under surveillance and scrutiny by a control authority. In the worst-case scenario, a company can undergo an enforceable undertaking (Lu, Sadiq, & Governatori, 2008).The company will position itself favorably with regulators and other controlling authorities if corrective measures are undertaken with a proactive approach. conclusion The states as well as the federal government administer and enforce laws related to safety. Companies are required to comply with the regulations and legal procedures of regulatory agencies just as much as they are required to follow federal laws. Managers must be aware of, and comply with federal and state laws that govern their business. Aligning business objectives with regulations and legislation will minimize tort and regulatory risks and improve business performance.