Risk in the spotlight at FIDIC conference

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Working together for successful outcomes is key to minimising and resolving disputes.

There is no substitute for collaborative and collegiate leadership if major infrastructure projects are to be delivered efficiently, successfully and without costly disputes.

This was the key message from a panel of industry experts who took part in a roundtable session on “Assessing the risk on major projects and minimising and resolving disputes” at FIDIC’s 2021 Global Infrastructure Conference taking place today (13.9.21).

President and chief operating officer of CDM Smith, Anthony Bouchard, said that the proper allocation of risk was crucial on major projects and that these risks needed to be identified early with only those best placed to manage them being responsible for dealing with them.

“It’s very important to work with all stakeholders on a project so that all players know who is responsible for what risk,” he said. Using standard contractual documentation was also crucial and, if the worst came to the wors,t then recourse to an efficient dispute resolution process. “Work early and in a timely fashion to help resolve disputes and always consider how the ‘human factor’ comes into play,” Bouchard said.

Sweco’s legal counsel, Lisa Lagerwall, stressed the importance of differentiating between mega-projects and standard projects as these were very different. Alignment between the parties on objectives and a culture of transparency was crucial in reducing and ultimately managing risks, she said.

Michael Earp, architects and engineers practice leader at AON, spoke about the current state of play in the professional indemnity insurance (PII) market. Earp said that there was a reduced appetite for project-specific insurance as nervousness about mega-project risk had increased. This needed to be understood by the industry, he said. “We have heard a lot about collaboration but if you truly want that approach then the insurer needs to be part of that collaboration,” Earp said.

WSP managing director for rail and Israel Darren Reed, highlighted the need for more integration between systems and the engineering on projects. “The more interfaces there are on projects the harder it will be to manage risks,” he said. These needed to be kept to a minimum with good collaboration between the project players, he said.

Business consultant and founder of 2MPy, Clare B Marshall, highlighted that the industry needed to be aware of some of the ongoing risks still present in the post-Covid environment the world was currently facing. “Leaders really need to take that broad view of risks and understand that they can come in all shapes and sizes – but also know that risks can mean opportunity and be alive to that too,” she said.

A good leader will have an eyes-wide-open approach to risk, Marshall said. Geo-political and technological developments will impact projects and a practical and real-world approach was essential as well as a strategic approach, she said. “Don’t forget either the importance of looking after yourself and your team,” Marshall also urged conference delegates.