Sean Lyons explains that organisations have explicitly focused on value creation at a strategic level through their company purpose, strategy, and business model. However, value preservation has rarely been explicitly addressed in the same way even though this can have a major impact on corporate culture and resulting corporate behaviour. He suggests that we are overdue a change in thinking.
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What is the relevance of the rise of ESG to Chief Risk Officers?
As a highly experienced Chief Risk Officer, Alex Hindson comments on the importance of proactively managing an organisation’s brand and reputation, particularly as the risks associated with ESG have been rising inexorably. He highlights the vital role CROs are able to play, given they are one of the few senior executives able to look across the breadth of ESG and sustainability issues.
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Objective-led risk management and oversight: extreme organisational agility in action?
Bryan Foss shares some of his practical experiences from his career as a non-executive director and chair of a risk and audit committee. He says a board-led strategic planning exercise, starting with purpose and objectives, are the key to effective risk governance and oversight.
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The risk that rarely speaks its name
As board members and risk professionals, we rightly focus on the risks that face our organisations. Francis Kean points out that we don’t focus on the risks to ourselves, and asks how well we understand the ways in which our liability insurance protections work and how they will respond in the event of a claim or investigation against us. He provides some practical steps we can take to understand these personal risks.
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Maintaining a dynamic approach to risk
Today’s environment highlights the fact that risks are not standalone and cannot be considered in isolation, argues Tim Copnell. A static approach to risk oversight and risk management, where risk strategy is reviewed a year, is no longer enough. He explains that a more dynamic approach, where risk is continually at the heart of strategic thinking and planning risk, is essential.
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Be prepared
Looking at the course of previous pandemics, Covid-19 has not been so different. As Lord Harris explains, pandemic flu has been in the top tier of the UK’s National Risk Register since it was first published a decade ago, yet it was not assigned with a sufficiently serious level of risk. He argues there needs to be a process of continually learning from experience and using that learning to strengthen the organisation ready for the next crisis – as well as the promotion of better preparedness in the UK for a major crisis or incident.
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Bribery and corruption: a need for continued board vigilance
We’ve recently seen the tenth anniversary of the enactment of the Bribery Act 2010, and Lord David Gold reflects on its success. He says that, rather than reducing British competitiveness as initially feared, it has resulted in companies improving their governance and it has brought them other benefits. He adds that, with the pressures brought by the pandemic, boards must be particularly vigilant in relation to bribery and corruption related risks.
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The challenges to getting objective-centric information
Boards need forward-looking, concise information that addresses the likelihood of the organisation achieving its most important objectives. However, Tim Leech says that there are barriers to achieving this and he sets out the challenges that risk functions and internal audit need to address to support their boards more effectively.
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Ten ways corporate boards need to approach risk in 2021
The WomenCorporateDirectors Foundation recently held two webinars, supported by the Risk Coalition, discussing how boards need to prepare themselves to tackle risk differently in 2021. They note 2020 forced companies to look at risk in new ways, and say that 2021 will be a time for boards to really integrate risk and strategy on a long-term basis. The webinars identified ten ways corporate boards need to approach risk in the year ahead.
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Focusing on Human Capital Risk
Oleg Lebedev sets out the true costs of poor employee health and engagement - significantly exacerbated during the pandemic. He argues that many businesses do not measure or manage human capital risk separately, and are unaware of how much of this risk is carried in their business and how effective the mitigation is - and that boards need to take this risk seriously.
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Defence, risk management and people
When it comes to risk management, Alex Chikhani says there is much that the private sector can learn from Defence. He says that Defence succeeds due to its agility, flexibility, and its ability to be reactive when needed. This means it can build into its capabilities the means to address the widest range and the greatest severity of possible threats. Most importantly, he explains that as Defence increases its diversity of thought, it strengthens its short/medium term risk management abilities.
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Where do risk leaders come from?
Neville Gaunt points out that the Coronavirus pandemic has exposed the frailties of many organisations across the globe and argues that this issue stems from the poor quality of leadership. He says that the roots of this are in our education system that doesn’t teach key skills for leaders - risk, leadership or communication - and he calls for action.
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How mitigating data protection risk builds trust and confidence with your customers
Nicola Wood, Senior Independent Director at the Information Commissioner’s Office (ICO), urges institutions to think about data protection law. She points out that that the potentially significant monetary impact of poor data protection practices will have caused organisations to reassess their rating of this risk. She says that boards should be asking questions about the data-related risks they are willing to take that could ultimately the loss of their customers’ trust, confidence and business.
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Accountability and risk governance
In today’s Risk Coalition blog, Professor Elizabeth Sheedy from Macquarie University explores what accountability means, how it relates to risk governance and why it helps to drive the right behaviours and to achieve desired outcomes.
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Expect the unexpected?
In today’s blog, Clive Martin discusses his new book in which he encourages people - especially non-risk management specialists, to think more smartly about the risks they take and the way they manage them. His goal is for us all to take better risks. He says that creative and imaginative ways of influencing others can spark the right sort of risk thinking.
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Mitigating the escalating risks for the C-Suite and their families
While busy executives (and non-executives) often feel they spend the majority of our time dealing with the risks of their organisations, sometimes they find - and often too late - that they need to consider their personal and family risks too. In this Risk Coalition blog, Philip Grindell from Defuse explains that these risks have escalated as a result of the Covid-19 pandemic.
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A day at the races
It’s necessary to take on more risk to achieve an objective, or so the saying goes. This is an often-heard argument that is made in boardroom and risk committee discussions, and presented as a self-evident truth. In this blog, Chris Burt explores whether this really always is the case.
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Resilience and the future of risk management
The Covid-19 pandemic has changed our perception of, and response to, risk. Robert Hall, Executive Director at Resilience First, argues that our traditional methodologies have not been applied rigorously enough either to reveal the hyper-connections of our complex world and that new, adaptable approaches are now needed.
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Missing (in)action
Last week, US regulators the OCC (the Office of the Comptroller of the Currency) assessed a $400 million penalty against Citibank. The penalty related to deficiencies in enterprise-wide risk management, compliance risk management, data governance, and internal controls. In today’s Risk Coalition blog, Chris Burt explains that inaction through failure to make improvements in risk management has a substantial cost as demonstrated by the Citibank case, adding that that risk management can make a significant contribution to an organisation’s performance.
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Geopolitical risk - do you know what should be keeping you up at night?
In today’s Risk Coalition blog, Derek Leatherdale explains that in a world with political instability in every continent and global volatility entrenched in the international landscape, it is more important than ever for financial institutions to adapt their approaches to risk management when it comes to geopolitical risk.
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