Risk management

Things that go bump in the nightFive potential problems to keep you awake at night:l Will I get insurance and at what cost?l What will happen to my work when I am away from the office?l Will I achieve my fee target for this year?l Are my staff and partners trustworthy and competent?l Will I face a complaint or a claim?Any of these ring a bell? An effective risk management strategy would help reduce these worries.

Unfortunately risk management is something that many firms only address at renewal time.

Do not just say what you think your insurer or broker wants to hear.

You must prove that you actually have an efficient risk management strategy.

Will I get insurance and at what cost?Insurers expect their professional customers to assume responsibility for control of their internal affairs.

You must take steps to reduce your exposure to the risk of claims.

Mistakes happen, but you must learn from them and take effective measures to avoid repeating them.

What will happen to my work when I am away from the office?This is the time that mistakes are often made by colleagues who are covering for you.

If you have risk management procedures in place that are followed by all staff, and are applied across the firm, it will make it easier for a colleague to deal with a file while you are away.

For example, firm-wide diary systems, check lists, case planners and file maintenance all lend themselves to common working procedures.

Will I achieve my fee target for this year?Hitting your billing target should not be your sole motivation.

The quality of the work and the client are just as important.

Have a client-vetting procedure to ensure that you are competent to carry out the work and are comfortable with the client.

Are my staff and partners trustworthy and competent?All staff and partners should be subject to proper risk management controls to ensure that they are carrying out their work effectively and efficiently with minimum exposure to risk.

Supervision procedures should be undertaken.

Although there must of course be an element of trust, it should not be blind.

Will I face a complaint or a claim?Complaints and claims are harmful both to the firm's reputation and finances.

Encourage partners and staff to discuss problem files and clients at the earliest opportunity, without fear of recrimination or the sack.

Make sure that risk awareness is at the forefront of every fee-earner's mind.

Sole practitioners: consider setting up a 'best friend' system.

Have an arrangement with another practitioner with whom you can discuss and share problems and concerns.l This column was prepared by the St Paul risk management team.