28Spire Healthcare Annual Review 2010Spire Healthcare takes a structured approach to managing risk. Our priorities are to protect people, property, finances and our reputation while delivering services critical to our business.Operational risk is reviewed each month by updating the Board on the operational performance of each hospital.Human resource updates are given to the Board on an annual basis and remuneration issues are governed by the Remuneration Committee.Spire's information management and technology risk is updated to the Board on an annual basis in addition to regular monthly briefings by the CEO.Financial risk is governed by the Audit Committee and financial risk updates are provided to the Board by the CFO on a monthly basis. In 2010, areas of note included advances in business continuity planning for the National Distribution Centre, including a reduction of key supplier dependency, reduced regulatory risk through the theatre sterile services unit programme and a significant reduction in engineering risk (see page 29). Risk reductions have also been achieved in information security through our central ISO 27001 accreditation and application of the NHS Information Governance toolkit.Clinical riskAs a provider of acute healthcare services, we recognise we are often entrusted by people receiving these services to maintain their safety when they are at their most vulnerable. Local application of a wide range of clinical risk control policies aim to ensure patients are protected from events that may lead to adverse outcomes. Risk assessments enable clinical departments to target controls on key risk areas, taking into account the needs of patients and nature of treatments delivered.Corporate riskSpire Healthcare robustly manages risks and uncertainties inherent in our business activities, taking steps to protect people, property, finances and reputation. Our approach to risk management demonstrates that recognition, analysis and control of risk is embedded throughout the organisation with free flowing information acted upon by appropriately empowered individuals.The Executive Management Team bi-annually reviews the corporate risk register that outlines key risks, measures likelihood and impact, determines controls and presents the level of residual risk. Spire's risk register groups risks under the headings of: . clinical. operational. human resource. information management and technology. financialEach risk entry is assigned to a member of the Executive Management Team to ensure that these reflect the conditions in their respective area(s) of responsibility.The Board of Spire Healthcare Group UK Limited also considers issues raised by the risk register either through regular Board updates or through its committees.Clinical updates from the Director of Clinical Services are given to the Board on a half-yearly basis and it is the Board's intention to develop a Clinical Governance Committee that will review both the clinical and health and safety effectiveness of Spire Healthcare.Risk management

29Engineering riskWe are now in year three of our five-year engineering plant replacement programme. It is designed to ensure that important facilities, such as ventilation equipment and boilers, are upgraded on a rolling basis and functioning well. Over £4 million was invested in 2010. The Engineering Governance component of the Spire Healthcare Engineering Strategy won the Laing & Buisson 'Excellence in Risk Management' award in September 2010. An overview of this strategy, 'Managing Engineering Risk - Strategy, Implementation and Benefits', was published in the IHEEM Health Estate Journal and presented at the Institute of Healthcare Engineering and Estates Management conference in October 2010. Regulatory riskSpire Healthcare enjoys good relationships with our key operational regulators, including the Care Quality Commission and the Health and Safety Executive. Standards are internally monitored by a programme of on-site clinical reviews involving peer audit and, for health and safety, external audit by our contracted health and safety advisors. Where regulators make suggestions or recommendations we work quickly to respond to these. In 2010 we received no formal improvement notices. Our clinical education and development programmes assist those staff subject to professional regulation to meet the requirements of continuing professional development. We operate robust systems to detect, prioritise, manage, analyse and learn should outcomes fall short of our high standards. A single incident reporting system and central incident review process aims to ensure serious events are dealt with in a timely and thorough manner. Our clinical governance system uses a wide range of patient-related data though the clinical scorecard, which allows us to benchmark performance and share best practice across our 37 hospitals and London Fertility Centre.Health and safety Our policy for the health, safety and welfare of employees, patients, visitors and all other persons affected by our activities promotes compliance with statutory duties and requirements of health and safety legislation. We set specific objectives and targets, promote good practice and, by monitoring performance, continually improve our high standards. Local health and safety plans promote safe systems at work and exist for hazards associated with specific activities and processes. A positive health and safety culture is fostered by active, visible leadership.We continually monitor adverse events, audits and risk assessments. External assurance was provided by Jacobs Consultancy who, in their 2010 annual audit report, commented on our continual improvement giving many examples of best practice. The mean hospital audit score in 2009/10 was 84%, improving from 77% in 2006/07*.* Figure relates to the hospitals audited in each of the years stated.