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Aid risk management

Aid risk management

Effective risk management practices are directly related to achieving results, and helps facilitate high performance. DFAT takes into account any risks that may hinder its ability to achieve its aid program objectives, and implements measures to increase the likelihood of success. DFAT manages aid risk throughout the lifespan of any investment.

DFAT also takes into account any risks that may impact on its ability to achieve its objectives with integrity. To ensure public funds are administered in alignment with Australian values and law, DFAT has a number of policies in place to manage specific areas of risk. These risk management policies are listed below. These areas of risk must be taken into account for all investments, regardless of the value or mode of the investment. The risk and safeguard tool must also be used to help determine the risk profile for risks related to environmental and social safeguards.

Before entering into an agreement or arrangement, DFAT conducts a due diligence assessment on recipients of DFAT funding (funding recipients). This helps DFAT manage any risks in relation to the performance of the funding recipients. For more information, see the Due Diligence Framework.

Funding recipients are also required to apply adequate risk management practices throughout the lifespan of an investment. This includes applying the below-listed risk management policies. For more information about these specific risk management policies, please click on the respective links below. For more guidance on aid risk management, see:

DFAT has standard clauses in agreements and arrangements that require funding recipients to report an incident in relation to the below-listed risk management policies. To report an incident, please find the relevant contact details below. Funding recipients must notify DFAT of incidents of fraud within five (5) working days. For all other notifications of incidents, funding recipients must notify DFAT within two (2) working days.

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