Cannabis Risk Management
What is Cannabis Risk Management?
Cannabis risk management is an effective and efficient means for cannabis organizations to gather important risk data, validate compliance, and report results to management. Often, risk management capabilities are internal and implemented in silos within the cannabis business, e.g., inventory, packaging, quality assurance, sales, financials and taxation Most internal programs fail to integrate and automate the gathering of data, risk assessment reports, and most importantly, risk-based scoring.
Below we explore the cannabis risk management landscape, including the following topics:
Cannabis Risk Management
There can be wide-ranging definitions of cannabis risk management among industry experts; however, cannabis risk management encompasses activities such as company compliance with applicable laws and regulations, enterprise risk management applications and corporate governance. Effective cannabis risk management relies on using data, information, and evidence to develop risk strategies and make compliance decisions.
An effective cannabis risk management framework enables cannabis businesses to integrate and coordinate risk and compliance initiatives with business processes. Our framework provides a comprehensive view of business risk and enables management to reduce risks effectively. By making informed decisions, based on assessment data, cannabis executives and stakeholders can better achieve compliance and mitigate cannabis business risk.
Cannabis stakeholders supported by cannabis risk management:
Executives - Founder/Owner, C-level, Legal & Directors
Management - Operations, Finance, HR & Employees
Regulatory - Federal, State & Local Agencies
Financial - Banks / Credit Unions & Payment Processors
Current Cannabis Risk Management Trends
Many cannabis businesses have established a compliance manager, or director, to lead risk management and compliance initiatives. The “one-person” solution across multiple departments often fails, as compliance initiatives become uncoordinated, leading to inefficiency, duplication of efforts and confusion. Fragmented cannabis risk management wastes employee time and company resources. The current state of risk management in the cannabis industry reveals:
Complex and fragmented
Lack of visibility for business functions
Lack of effective program oversight
Using spreadsheets OR expensive, poorly designed compliance software
Evolving from cannabis compliance to integrated risk management and scoring is key to identifying, managing and reporting on risk.
Importance of Risk Assessment Scores
Risk assessments are lacking in the cannabis industry. Assessments can help identify and manage risk by collecting information on existing and emerging risks, and the accuracy and effectiveness of controls. Assessments can determine if the compliance team is doing its job. Risk-based scoring can determine the success of the team and where it can improve.
If you cannot measure it, you cannot quantify it. To accurately gauge your risk exposure, all relevant requirements must be codified, categorized, and prioritized. The Global Go Cloud risk assessment scoring algorithm helps dictate cannabis risk strategy for inventory, operations management, financials and regulatory success.
Return on Investment (ROI) Review
Return on investment (ROI) review of internal compliance programs can be exceedingly difficult; however, our automated cannabis risk management applications ensure a positive ROI from the start.
Our integrated cannabis risk management program reduces costs, duplication of activities, negative impacts on operations and provides a greater ability to build repeatable risk management processes.
Less time on gathering, assembling, and reporting on risk assessments
Moving from "silo" to integrated risk management
Estimated Program ROI
As the cannabis industry faces a rapidly changing regulatory environment and increasing complexity, organizations must focus on a structured approach for managing cannabis risk management. More time must be spent on risk analysis and problem-solving, with less time spent on data collection, spreadsheets, or managing expensive compliance applications.
Leverage the benefits of automated cannabis risk management applications while working with trained and experienced consultants. Interested in learning more? Contact Us.
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