Risk and Opportunity Management

SANBS embraces risk and opportunity management as an essential enabler for setting and achieving its strategic objectives and fulfilling its purpose of being ‘Trusted to Save Lives.’ This approach emphasises our commitment to continuous improvement, which is vital for building resilience and remaining relevant in the ever-evolving landscape of the future.

Managing our risks and opportunities to ensure we manage what matters most

Risk management is governed by an Enterprise Risk Management (ERM) Framework which provides a solid foundation to guide the organisation in embedding structured risk management processes to deliver sustained value.

Through the ERM process, risks and opportunities, which could affect the achievement of our iHEALTh strategy, are identified and managed within defined risk appetite and tolerance levels set by the Board. Management decisions to tolerate, treat, terminate or share risks and opportunities are taken based on these parameters.

As an essential healthcare service provider, it is prudent that SANBS protects its donors, patients and stakeholders from the potential adverse effects of risk and it has therefore adopted a conservative risk approach.

SANBS follows an iterative and dynamic risk management process to ensure ongoing identification and evaluation of risks and opportunities in response to a continually evolving and rapidly changing internal and external environment. Risks and opportunities are also identified through stakeholder engagement.

Oversight of risk management is the responsibility of the Risk, Technology and Information Governance Committee.

Notable events/risks for 2023

Our material matters are reflected in our key risks and opportunities and represent the issues that have the most impact on our ability to create sustainable value for our stakeholders and influence our business model.

Of significance during the reporting period are:

Increased integration of risk management principles in process improvements
  • Continued identification, prioritisation, treatment, and monitoring of projects risks, particularly in the BECS implementation project
  • Planning and monitoring of financial process improvements
  • Reporting – to increase understanding of each strategic risk and to further enhance information documented and thereby improve risk management in the organisation
Internal/external events that had a significant impact on the SANBS risk profile
  • KZN floods impacting blood collection and SANBS operations and heightened occurrences of extreme weather events
  • International geo-political instability
  • Implementation of the identified Target Operating Model
  • Worsening economic conditions, fuel increases, deteriorating exchange rates, rising interest rates
  • Sporadic instances of negative media. Media platform monitoring software is used to detect both positive and negative comments, so that we react appropriately
  • Deteriorating infrastructure in South Africa (power supply, roads and water)
Initiatives to enhance risk management
  • Improvement of integration of risk management into the strategic planning cycle
  • Robustness of Business Continuity Plans tested during extreme weather events and riots
Emerging risks and opportunities
  • Monitoring changes and planned changes to compliance requirements enabling timely planning for necessary process amendments – removed NHI implementation as it is not anticipated in the short term
  • Emerging risks of increasing civil unrest due to worsening socio- economic conditions – now managed as a strategic risk (7)
  • Continued focus on enhancing collections to meet increased demand for blood products. Sustainable blood supply programmes put into place to address this, included the Platelet strategy, Group O strategy and Donor iron strategy is in place to address this
  • Leveraging local and international collaborations
  • Continued monitoring of the external environment for emerging infectious diseases that could impact the supply and the demand for blood products
  • Monitoring of commodity shortages (e.g., global silicon shortage, chemicals, BECS tablets) that could impact SANBS’ operations and capital investments
  • Monitoring the environment to identify opportunities for expanding translational research into novel products
  • BCP overarching consolidation – crisis communication management plan

Benefits Derived from Practising Good Risk Management

Our ERM framework is premised on global practical risk management practices including ISO31000 and King IV™, and includes the identification, analysis, evaluation, treatment and monitoring of risks and opportunities from a position where we understand the context of our internal and external business environment and the impact on our iHEALTh strategy.

*Figure 1 demonstrates how the effort is driven by the Board, Senior and Middle Management to manage and report on risks.
**In addition, all lines of assurance are included as part of the Board and Board Committee oversight to ensure that roles, responsibilities and accountabilities for risk are clearly defined. See Figure 2.

SANBS Risk Profile (Risk Heatmap of Top Risks)

Strategy level risks – March 2023

No. Strategy level risks – March 2023 Short term FY23 FY22 FY21 FY20 FY19
1 Ineffective and inefficient order-to-collect process 1 - - - -
2 Inability to remain financially sustainable 2 4 3 1 2
3 Impact of weak internal controls on compliance and financial assurance 2 2 - - -
4 Loss of public/stakeholder confidence 4 9 8 2 1
5 Inadequate management of information/data relating to:
  • Electronic
  • Structured data
  • Unstructured data
  • Manual/paper-based
5 - - - -
6 Inability to consistently meet all demand for specific blood products
  • Group O RBC
  • Pooled platelets
  • Apheresis platelets
  • Rare donors
  • Reagent donors
  • Plasma
6 3 2 10 10
7 Political/socio-economic instability leading to civil unrest 7 - - - -
8 Inability to attract and retain highly specialised/portable/scarce skills 8 1 1 3 3
9 Adverse impact of poor organisational culture 9 9 8 2 1
10 Non-compliance with regulatory requirements 10 10 9 7 7
11 Ineffective and inefficient procure-to-pay process 11 11 11 - -

Risks with a low residual risk are included for information purposes. These will continue to be monitored by leadership.

No. Strategy level risks – March 2023 Short term FY23 FY22 FY21 FY20 FY19
12 Disruption in business operations 12 - - - -
13 Failure to be innovative 13 6 5 8 8
14 Uncertainty as to the impact of the NHI implementation on the SANBS business model 14 8 7 9 9
15 Compromised safety and quality of blood products 15 7 6 4 4
16 Failure to provide and maintain stable information management systems 16 5 4 6 6
17 Environmental sustainability 17 - - - -