2012-13 Departmental Performance Report
Risk Analysis
Organizational Context
Fisheries and Oceans Canada's mission critical corporate risks were established taking into consideration the internal and external context in which the Department operates. The Department is at a moment where the broader operating environment, taken together with the fiscal reality, has created unique challenges and opportunities. As an agile and evolving organization, the Department is transforming to respond to these challenges and opportunities, while continuing to manage the risks it faces.
The Department's mandate is broad. It develops and implements policies and programs in support of Canada's economic, scientific, and ecological interests in oceans and fresh waters. The Canadian Coast Guard plays a key role in the maritime economy as well as maritime security, contributing to safe and efficient navigation for marine transportation and providing maritime services such as search and rescue, environmental response, and icebreaking.
Fisheries and Oceans Canada's overarching oceans agenda – scientific research, policy development, and departmental programs – must be strong and forward looking, taking into account domestic and global trends in diverse fisheries and marine industries. Maritime safety and security demands are also changing. Navigable waters are expanding with new sea routes emerging in Canada's North. Demands for efficiency, flexibility, and responsiveness necessitate ongoing modernization and improvement of the Canadian Coast Guard’s fleet and services.
In addition, fisheries markets are globalizing. To compete effectively in these markets, the Department must understand changes to global demand and consumer preferences. It also means the Department must respond to demands for sustainable harvesting practices and the ability to trace the origin of seafood products and label them as environmentally friendly. Proper protection and management is important to their sustainability, competitiveness, and profitability. Fisheries management must respond by establishing clear, predictable rules that allow fishing stakeholders to make rational business decisions.
In response to the current environment of fiscal restraint, the Department continued to reassess how it conducts its business, provides services, and delivers on its programs to meet client and stakeholder needs. As a result, the Department developed plans to support change decisions, now in the early stages of implementation. As the environment within which the Department operates continues to change, and as stakeholders' requirements evolve, the Department finds itself challenged to meet these demands. Fisheries and Oceans Canada must ensure that it has sufficient resources to meet these new pressures while recognizing that stakeholders' expectations must be adequately addressed and managed to decrease litigation risks and maintain the Department's reputation amongst its clients.
In this context, the Department identified five mission critical corporate risks for 2012-13, as described in the 2012-13 Report on Plans and Priorities. Any of these could impact one or more of the strategic outcomes, depending on changes to the risk drivers in the internal or external environments.
Risk Analysis
Fisheries and Oceans Canada's Corporate Risk Profile is based on the methodology established by international and Canadian standards and endorsed by the Treasury Board Secretariat. Risk reports, including the Corporate Risk Profile were presented to the Departmental Management Board for review and to the Departmental Audit Committee for validation at mid-year and year-end, and were also integrated with business planning and strategic priorities setting at the corporate and program levels.
The corporate risk assessment methodology employed at Fisheries and Oceans Canada is a hybrid of bottom-up and top-down approaches. Program-level and regional risk profiles were compiled and analyzed for department-wide risk information. From this, as well as an in-depth analysis of internal audits, evaluations, business plans, security, human resources plans, and information management/information technology plans and the organization's Environmental Scan, a preliminary assessment of the corporate risks was made. This assessment was presented to senior management for their review, discussion, and decision, resulting in risk information that is better defined, clarified, and prioritized.
For the action plans identified under each mission critical risk in the 2012-13 Report on Plans and Priorities, accountability was assigned to appropriate senior managers responsible for reporting on progress on these actions through the Department's One Pass Reporting cycle. This information was consolidated to obtain a complete perspective of how well the Department is managing its mission critical corporate risks.
The table below provides a summary status of the Department's mission critical risks for 2012-13:
| Risk Statement | Link to Program Alignment Architecture | Link to Organizational Priorities | Risk Response Strategy Performance |
|---|---|---|---|
| Financial Capacity Risk – Internal | |||
| As a result of increasing operational costs, fiscal restraints, increasing stakeholder expectations, and the complexity of reducing the departmental footprint, there is a risk that sufficient resources may not be available to maintain appropriate service levels for internal and external client groups. |
Economically Prosperous Maritime Sectors and Fisheries Sustainable Aquatic Ecosystems Safe and Secure Waters |
Renewing Canadian Coast Guard Capacity and Assets Advancing Management and Operational Excellence Reviewing Habitat Policy and Program Improving Fisheries Management |
All actions were completed or on track. Actions on and related to transformation are still underway. Risk action plan performance:
|
| Communications and Reputation Risk – Internal | |||
| As a result of the Department's new policy direction, the inherent complexity of communicating with a diverse client base, and conflicting external stakeholder expectations and interests, the Department may not be able to adequately maintain public trust and confidence, and subsequently its reputation. |
Economically Prosperous Maritime Sectors and Fisheries Sustainable Aquatic Ecosystems Safe and Secure Waters |
Renewing Canadian Coast Guard Capacity and Assets Advancing Management and Operational Excellence Reviewing Habitat Policy and Program Improving Fisheries Management |
All actions were completed. Risk reduced and no longer considered mission critical for 2013-14. This is now a key risk that is being monitored. Risk action plan performance:
|
| Human Capital Risk – Internal | |||
| As a result of a dynamic change agenda in 2012-13, there is a risk that the Department's workforce may not have the capacity to successfully absorb and implement transformational changes. As a result of the Department's new policy direction and the inherent complexity of communicating within a large, diverse, and geographically dispersed organization, there is a risk that the Department may not be able to adequately maintain confidence and subsequently its reputation internally. |
Economically Prosperous Maritime Sectors and Fisheries Sustainable Aquatic Ecosystems Safe and Secure Waters |
Advancing Management and Operational Excellence | All actions are on track. Actions on and related to transformation are still underway. Risk action plan performance:
|
| Physical Infrastructure Risk – External (Physical infrastructure includes: Fleet assets, small craft harbours, real property, information technology assets, equipment, and other moveable assets.) |
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| As a result of an unsustainable asset base of ageing infrastructure in an environment of increasing fiscal restraint and the complexity of reducing the departmental footprint, there is a risk that the Department may not be able to align or maintain its infrastructure and assets at an adequate level to ensure the safety, security of staff and stakeholders, and the delivery of core services and programs. |
Economically Prosperous Maritime Sectors and Fisheries Sustainable Aquatic Ecosystems Safe and Secure Waters |
Renewing Canadian Coast Guard Capacity and Assets Reviewing Habitat Policy and Program Improving Fisheries Management |
Actions related to fleet renewal, Marine Communications and Traffic Services, shore based asset renewal, and real property transformation are still underway. Response was not sufficient to meet the targeted risk tolerance; as such more comprehensive action plans were put in place and will be reported against in future years. Risk action plan performance:
|
| Legal and Compliance Risk – External | |||
| As a result of how Fisheries and Oceans Canada sets its priorities and policies and delivers its programs, there is a risk that:
1) The Department's regulatory and operational decisions may be challenged in court, resulting in financial liability or limits or changes to our authority, policy, or regulatory tools; and, 2) Some stakeholders may seek to use the courts to alter departmental priorities or program delivery. |
Economically Prosperous Maritime Sectors and Fisheries Sustainable Aquatic Ecosystems Safe and Secure Waters |
Renewing Canadian Coast Guard Capacity and Assets Reviewing Habitat Policy and Program Improving Fisheries Management |
All actions are on track. Response was sufficient to reduce this risk to an acceptable tolerance level and, as such, this risk is not considered mission critical for 2013-14. This is now a key risk that is being monitored. Risk action plan performance:
|
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