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Proactive Disclosure
Risk Management
CIDA's success depends on its ability to:
- lay out clear, achievable, and measurable results
- understand the risks involved
- put measures in place to monitor and manage risks.
In terms of results, CIDA's priority themes guide its programming. CIDA has published summaries of its country and key multilateral partner strategies, mapping out the concrete results within each priority theme to which Canada's aid will contribute.
Based on these strategies, CIDA develops frameworks against which it monitors progress and manages the delivery of results.
For all investment decisions, CIDA performs a thorough analysis of risks, including fiduciary concerns, natural disasters, security, and partner capacity risks, and identifies appropriate responses.
Pro-actively managing risk increases the effectiveness of CIDA's efforts to achieve concrete development results.
How CIDA manages risk
Fighting Corruption
Corruption can occur in any country; however, the risk is greater in developing countries where partners and institutions often have weak capacity.
CIDA has zero tolerance for fraud and corruption. To ensure that aid dollars go to the right people for the right reasons, CIDA has a robust set of controls to prevent the mismanagement of funds.
CIDA only invests funds where it can provide reasonable assurance to Parliament that it can assess, monitor and manage risk during project implementation, so that CIDA's funding is used for its intended purposes.
CIDA also works with developing countries to build good governance and to help them build their own systems to manage public finances in an open and accountable way.
CIDA's risk management process is based on the Government of Canada's Treasury Board Secretariat 2010 Framework for the Management of Risk and Guide to Integrated Risk Management and has been adapted to meet CIDA's working environment and include lessons learned from more than 40 years of risk management.
It embraces the need for ongoing assessments of risks (as they relate to development results and internal management practices) at every level and in every sector of the organization.
It includes four steps:
- establishing the context
- assessing the risk (identifying, analyzing and responding)
- reviewing the risk (risk tolerance and additional response)
- monitoring and evaluating risk
Throughout this process, CIDA communicates and consults with stakeholders.
CIDA has identified four categories of risk in its development assistance programs and its day-to-day operations, after consulting with Treasury Board Secretariat and other Government of Canada departments and agencies, the International Organization for Standardization, and other development partners.
These are:
- Operational risks — with a potential impact on CIDA's ability to operate effectively or efficiently.
- Financial risks — with a potential impact on CIDA's ability to properly protect public funds.
- Development risks — with a potential impact on CIDA's ability to achieve expected results.
- Reputational risks — with a potential impact on CIDA's reputation and stakeholder confidence in CIDA's ability to fulfill its mandate.
CIDA is committed to refining each risk in terms of its impact and likelihood, including:
- identifying current and emerging risk owners
- highlighting risk sources and origins
- understanding appropriate risk response measures
- improving the Agency's capacity to manage and adjust to risks that can affect development results.
More information is available in the glossary.
