Factors affecting implementation of risk management systems at municipalities in the Overberg district, South Africa

Abstract

The aim of the study was to investigate the effectiveness of risk management systems within municipalities in the Overberg district of South Africa. The value of effective risk management systems in any organisation cannot be underestimated as it is responsible for appropriately identifying, assessing, and treating risks that may adversely influence the achievement of organisational objectives. The Overberg district municipalities were used as case studies to identify and evaluate the factors that could affect implementation of risk management systems at a local government level in a specific geographical area. The primary research question was what factors affect the effective implementation of risk management systems at the Overberg district municipalities. To answer this research question, sub-questions and research objectives were formulated to determine the relevant factors. The research employed descriptive statistics, as well as inferential analysis to analyse the data. Lack of sufficient funding for risk mitigation seemed to be the main factor that affects the implementation of risk management systems within the municipalities. In addition, the research highlighted the current gaps in the implementation of risk management processes. This made municipalities aware of the risks within their organisation and identified the benefits of implementing sound risk management initiatives. The contribution of the research will empower the Overberg district municipalities to manage their key organisational risks proactively. This will lead to sustainable local governments that will be able to continue to perform their primary functions effectively. From the results, it was evident that although the Overberg district municipalities had risk management systems in place, insufficient funding posed a challenge to effective risk mitigation. Municipal management should therefore allocate sufficient funding to ensure effective implementation of risk management systems.