1. SUB-MODULE 6. RISKS AND MITIGATION MEASURES RESULTS BASED LOGICAL FRAMEWORK TRAINING Quality Assurance and Results Department (ORQR.2)

2.  Introduction to the RLF  Participatory Approach for RLF development  The results chain  Performance indicators  Means of verification  Risks and mitigation measures 6 Sub-Modules TRAINING CONTENT 2 RESULTS BASED LOGICAL FRAMEWORK TRAINING Evaluation I.Examen a la fin de la formation II.Questions de choix multiple, questions ouvertes et etudes de cas

3. CONTENT: SUB-MODULE 6 3 I.Risks and mitigation measures in the RLF. II.Definition. III.Risks and assumptions. IV.Identifying project risks V.How to analyze risks VI.Country effectiveness and sustainability risks. VII.Project effectiveness risks. VIII.Project implementation risks. IX.Practical tips. RESULTS BASED LOGICAL FRAMEWORK TRAINING

4. 4 OBJECTIVE: SUB-MODULE 6 At the of this sub-module, Bank staff should be able to:  Identify and analyze potential constraints to project implementation and achievement of the project objective. RESULTS BASED LOGICAL FRAMEWORK TRAINING

5. I. Risks and mitigation measures in the RLF 5 Country and Project name: Project objective: Results chain Performance Indicators Means of verification Risks and mitigation measures IndicatorBaselineTarget Impact Country effectiveness and sustainability risks Outcomes Outcome 1 Outcome 2 … etc. Project effectiveness risks Outputs Component 1 Output 1.1 Output 1.2 … etc. Component 2 Output 2.1 Output 2.2 … etc. Project implementation riks Key activity Component 1: Component 2: Inputs Component 1: Component 2: RESULTS BASED LOGICAL FRAMEWORK TRAINING

6. II. Definition 6  Risks are conditions or uncertain factors which may occur or not, and have a negative impact on the achievement of project results.  Risks may be political, social, financial, environmental, institutional, and related to climate change. RESULTS BASED LOGICAL FRAMEWORK TRAINING

7. III. Risks and Assumptions 7  Risks that are under the control of the project and may be mitigated  Mitigation measures apply Risks are taken into account in the RLF  Risks that are associated with uncontrollable circumstances.  No mitigation measures envisaged  Assumptions are factors that are not really known or not yet determined, low probability of occurrence.  The RLF does not refer to assumptions, it focuses on the risks of high incidence and likelihood of occurrence RESULTS BASED LOGICAL FRAMEWORK TRAINING

8. IV. Identifying Project Risks (1/3) 8  List risks typically encountered in past operations.  Stakeholders analysis – brainstorming and interviews (during planning and implementation).  Problems and objectives analysis.  Detailed analysis of the Results Chain.  Detailed analysis of the work program/project schedule RESULTS BASED LOGICAL FRAMEWORK TRAINING

9. 9  Identify problems without adequate solution according to the problems and objective trees. Problem (effect) Low yields in farming area Problem (cause 1) Poor quality seeds Problem (cause 2) Improper Crop husbanding Problem (cause 3) variable rainfall End (Solution) Improved yields in farming area Means (solution to problem 1) Use of quality seeds Means (solution to problem 2) Use of proper crop husbanding No direct solution Problem tree Objective tree RESULTS BASED LOGICAL FRAMEWORK TRAINING IV. Identifying Project Risks (2/3)

10. 10  Conduct a stakeholder analysis to identify the support or resistance of stakeholders groups to achieve the project objective. Risks identified and assumptions RESULTS BASED LOGICAL FRAMEWORK TRAINING IV. Identifying Project Risks (3/3) Initial Design PhaseFinal Design Phase StakeholderInterests Problems Perceived ResourcesMandates Interest in the Project Strategy Force-Field Analysis 1. Maximize profits 2. Want access to clean water Fishing families 1. River water quality is deteriorating 2. Pollution is affecting volume and quality of catch 3. Family health is suffering, particularly children and Mothers 1. Appear willing to pay for improved waste management services 2. Potential to lobby government bodies more effectively New government legislation in preparation on Environmental Protection – largely focused on making polluters pay 1. Improved family health, particularly children and mothers 2. Improved river water quality 1. Strong support in case of conservation or pollution control measures 2. Resistance in case rights to catch fish are limited

11. 11 V. How to Analyze Risks? Proposed risks analysis methodology LIKELIHOOD that risk materializes Very highHighLowVery low Magnitude of impact Very high High Low Very low  Analyze the impact of risks on the project’s objective and the likelihood they will occur.  Risks falling in the red, orange, and yellow areas are then candidates to be included in the project RLF, with the corresponding mitigation measures. RESULTS BASED LOGICAL FRAMEWORK TRAINING

12. VI. Country effectiveness and sustainability risks 12  Types of country effectiveness and sustainability risks:  Alignement with national development strategies and CSP  Financial sustainability  Institutional sustainability  RLF - If the proposed outcomes are achieved and the country risks are properly managed, the project will contribute significantly to the desired impact. Examples of risksMitigation measures Deterioration of the business environment Provide Technical Assistance to Government to reform the PFM Government is not interested in improving the public financial management policies Dialogue with Government to streamline the monetary & trade policies RESULTS BASED LOGICAL FRAMEWORK TRAINING

13. 13  Types of project effectiveness risks  Development objective – link to a priority goal of the Bank´s sector strategy  Reputation – support from beneficiaries.  Stakeholder acceptance/support of outcomes.  RLF - If the proposed outputs are achieved and the project effectiveness risks are properly managed, the project will contribute significantly to the desired outcomes. Examples of risksMitigation measures Climate variability in the project area Set the project intervention on the basis of new data on climate change Inadequate Donor coordination Revise the Donor coordination framework RESULTS BASED LOGICAL FRAMEWORK TRAINING VII. Project effectiveness risks

14. 14  Types of project implementation risks  Justification and relevance – commitment of authorities.  Fiduciary performance.  Environmental and Social safeguards.  Stakeholder support.  Project integrity (Fraud/corruption in implementation).  RLF - If the proposed activities are undertaken and the project implementation risks are properly managed, the project will deliver the expected outputs. Examples of risksMitigation measures Communities can not properly maintain the facilities provided Make sure that the provision of infrastructure is demand-driven and that communities are fully sensitized and mobilized Input prices fluctuate beyond the 10% estimated Funds reallocated between the loan categories and project target revisited RESULTS BASED LOGICAL FRAMEWORK TRAINING VIII. Project implementation risks

15. 15 IX. Practical tips  Incorporate risk management into the project design.  Follow up risks during the design and implementation of the project. Risks change over time.  Effectively communicate and discuss the potential risks, and the appointment of staff responsible to implement the mitigation measures (through the Implementation Progress and Results Report - IPR).  Clearly specify the actions of risk management. (Do they have a cost?).  Consider the threats and opportunities that risks can bring.  Analyze the impact of risks on the project objectives and the likelihood of their occurrence, plan accordingly the mitigation measures to be implemented.  Record risks for future operations. RESULTS BASED LOGICAL FRAMEWORK TRAINING

16. 16 Your one-stop shop to quality assurance and results reporting tools used throughout the project cycle RESULTS BASED LOGICAL FRAMEWORK TRAINING ACCESSIBLE THROUGH THE INTRANET Quality Assurance Assistant