One of the world’s largest mining companies, Vale, is striving to achieve best practices in risk management. Headquartered in Brazil, Vale is the market leader in production of iron ore and ranks second in production of nickel, as well as producing pellets, coal, copper, fertilizers, manganese and ferroalloys – with around 195,000 employees working in 30 countries on five continents. As a member of the International Council on Mining and Metals (ICMM), Vale is publicly committed to “implement[ing] risk management strategies based on valid data and sound science.”
Today, Vale is developing a comprehensive new strategy for Enterprise Risk Management. The company’s operational risk management team had historically focused primarily on loss recovery, looking at how the cost of assets could be protected through insurance. In 2006, however, Vale’s risk managers saw that they needed to take a broader view by identifying potential events or circumstances that might impede their company from achieving its business objectives, assessing those issues in terms of their likelihood and magnitude, determining preventive or remedial actions, and then monitoring the progress of those actions to completion.
The Operational Risk team at Vale recognized that the success of their evolving strategy would depend upon their ability to collect, aggregate and analyze vast quantities of information from across the company so they established a framework for integrated risk management. This framework was designed to provide standardized policies, procedures and guidelines for risk governance as well as the tools and techniques required to translate rules into action by measuring risks, making decisions and assigning/tracking tasks.
For the first few years, Vale’s risk managers tried to support the risk framework with hundreds of spreadsheets and databases. “We probably performed a dozen risk assessments within each business unit and we have 30 plus business units. Managing all of that data in spreadsheets was too big a job and ineffective,” says Alain Valiquette, Operational Risk Manager for Base Metals at Vale. “So we went on the hunt for a global software solution. We looked at a short list of vendors and it quickly became apparent that IHS is the leader. Since we’d already used other IHS risk software successfully for several years, it was a natural next step for us.”
- Develop a comprehensive strategy for Enterprise Risk Management
- Provide information foundation to support the framework for integrated risk management
- Embed risk management in the daily corporate culture by sharing information
- Drive operational excellence by streamlining workflows and uncovering efficiencies
- IHS Operational Risk Solution with IHS Stature
- Enables ERM strategy by replacing 100s of spreadsheets with 1 global risk management information system
- Empowers operations team by providing standardized risk data tool and workflows
- Reduces time to roll up enterprise risk data into a report by up to 99% – e.g. from an estimated 2 hours to 2 minutes
- Generates risk assessments that ensure future funding for risk control actions
- Developing innovative “heat-map” reports that offer various decision-makers tailored views of their risks and responsibilities