2023 2023 CGIAR Annual
Report

Risk is not inherently negative. CGIAR understands that embracing and handling risks are essential for executing its strategy, emphasizing that efficient risk management is crucial for its success and a fundamental aspect of good governance. Effective risk management is not just about mitigating risks; it also involves making informed decisions about risk-taking.

Managing risk in Initiatives can deliver significant value by fulfilling several critical purposes. Firstly, it enhances the likelihood of achieving objectives by ensuring effective and consistent progress. Secondly, it enables strategic decision-making that is informed by a comprehensive understanding of potential opportunities and threats. Lastly, it creates a foundation for compliance with regulations and fosters robust governance and assurance, thereby contributing to the overall success and sustainability of the Portfolio.

Approach and progress

Between November 2023 and January 2024, all Initiatives followed a common approach to update their top risks as part of the Reflect process. Whilst Initiative teams may maintain a longer list of risks which they monitor and manage on an ongoing basis, the reporting process is only requesting the top five risks to impact contribution to be reported annually. This is to help ensure the burden of reporting on Initiative teams remains proportionate and governing bodies receive risk information in a prioritized way rather than the complete register of risks. The standard approach to Initiative risk reporting allows portfolio managers to monitor and manage the balance of risks across the Portfolio, and make sure resources and support are provided, and decisions are made at an appropriate time.

The risk management process followed, adapted from ISO 31000:2018 – the international standard on risk management – is illustrated below.

Figure 6.2. CGIAR’s risk management process.

Scope

Guidance on risk scope provided to Initiative teams focuses on risks to an Initiative’s contribution to impact. These are the processes, outlined in the Initiative’s theories of change, by which the Initiative, with partners, contributes to processes which are expected to ultimately lead to impact within one or several of the five Impact Areas set out in CGIAR’s 2030 Research and Innovation Strategy. The risks reported by Initiatives are almost evenly distributed across three main categories: financial, operational, and strategic, with strategic featuring slightly stronger.

Figure 6.3. Category groups for risks reported in 2023.
Source: Initiative Risk Management Module in the Performance and Results Management System (PRMS).

Key areas of risk

While risks for Initiatives are interconnected and complex, organizing risks into categories helped to identify common themes and prioritize resource allocation and ownership. These categories provide a framework for understanding and managing risks effectively. Stakeholders can better identify patterns, address underlying issues, and allocate resources strategically to mitigate potential challenges. However, it is important to recognize that risks often overlap and interact in intricate ways, necessitating a comprehensive approach to risk management.

Based on reported risks, as shown on the chart below, the categories of risk that scored higher are Scaling Impact, Partners and Partnerships, Operations and Funding. Definitions provided to the Initiatives teams are illustrated in the table below.

Figure 6.4. Risk categories and their definitions.
Source: Initiative Risk Management Module in the PRMS.

Breaking down scaling impact risks for the Portfolio

Policy and regulatory risks: Unfavorable international policies may hinder partnerships for germplasm exchange, impacting research scope. Complex policy environments may hinder innovation uptake.

Challenges in technology adoption: Inability to incentivize behavior change among stakeholders may hinder the adoption of innovations. Unfavorable policy environments and climate-related stresses also pose adoption challenges.

Operational constraints and readiness for scale: Failure to deliver outcomes on time, lack of scalable technologies, and poor alignment with other Initiatives may hinder scalability. Stakeholder engagement and policy alignment are also key challenges.

Gender and social inclusion barriers: Gender and social norms may limit system-level changes, while capacity constraints and conflicting interests among stakeholders hinder consensus and adoption. Lack of political will and operationalization of supporting policies further exacerbate these challenges.

Breaking down partnership and partner risks for the Portfolio

Partnership challenges: Low willingness of demand partners, institutional barriers, and reluctance of national authorities hinder effective partnerships.

Data sharing reluctance: Countries may resist sharing plant disease data, impacting research efforts, along with challenges in aligning government priorities with Initiative programs.

Capacity and engagement issues: Limited skills among partners, inability to incentivize stakeholder behaviors, and poor coordination between ministries/agencies impede progress.

Policy and governance constraints: Weak urban governance, lack of government support, and poor coordination hamper policy implementation.

Uncertainty and disengagement: Future program uncertainty, conflicts between stakeholders, and low engagement from public actors pose significant risks to Initiative success.

Breaking down operations risks for the Portfolio

External event risks: Adverse events such as security issues, political instability, or natural disasters in target countries can disrupt operational activities, stakeholder engagements, and research partnerships, affecting implementation and success.

Technical and operational challenges: Technical limitations, operational inefficiencies, and difficulties in adapting to changes may impact efficiency.

Impact of organizational changes: Reorganization within CGIAR or other institutions can disrupt execution and generate uncertainty.

Breaking down funding risks for the Portfolio

Inadequate funding and resource allocation: Lack of adequate funding may prevent the capture of technical advances and innovations, leading to inefficiencies. Internal budget uncertainties and reliance on inconsistent pooled funding further compound the problem. Additionally, unstable funding from CGIAR donors and uncertainties regarding geopolitical events may disrupt planning and performance.

Challenges in scaling innovations: The scaling of innovations and innovation packages may be hindered by inadequate or unsustainable financial support. Insufficient resources for rigorous impact assessment of plant health innovations may also limit their scalability and impact.

Dependency on stable funding: Initiatives rely heavily on assumptions of stable funding sources, such as pooled funding and anticipated increases in funding from the CGIAR transition. Uncertainty regarding funding flows, budget insecurity, and delays due to geopolitical events pose significant challenges to the implementation of planned activities and achievement of desired outcomes across all Work Packages.

Impact on innovation pilots: Funding uncertainties and delays may result in insufficient resources to test planned innovation pilots, threatening the sustainability of projects and their ability to achieve long-term objectives. The use of grant mechanisms may fail to produce innovative solutions with scaling potential, further exacerbating the issue of inadequate funding.

Progress on actions

The most significant risks to impact contribution may fall within the Initiative’s sphere of control, sphere of influence or sphere of interest. This may mean that, for some risks, the Initiative team, or Science Group leads, may be able to effectively manage or mitigate the risk, whilst for others, risk management or mitigation may more effectively be carried out by partners. For some risks, management or mitigation may not be feasible or proportionate. It is still important to identify and monitor such risks, as this will help inform Initiative decision-making.

Based on reported actions for the identified risks, as shown in the chart below, most actions are considered as ongoing and on track.

Figure 6.5. Status of reported actions for identified risks and definitions.
Source: Initiative Risk Management Module in the PRMS.