Strong management and sound decision-making are critical to good organisational outcomes; but how can boards, executives and senior managers pursue these aims at a time of great risk? Amanda MacGregor, Senior Consultant in Finance, Accounting, Legal and Risk at GWG, takes us through why a risk specialist could be your best next strategic move.
For some organisations, risk management is viewed narrowly as a compliance function; a ‘tick the box’ exercise in meeting regulatory obligations and demands of boards of directors in discrete functional areas (financial, operational, reputational, etc.). And while there is a (very necessary) place for compliance regimes in managing known risks in reasonably static environments, one of the key lessons to come from the experience of COVID-19 is that the business environment is anything but static. Moreover, risk is not the kind of well-behaved house guest who contains themselves to a single room or functional area of your business! Organisations who take a broader view of risk are best placed to link and measure the many risks they face. Indeed, approaches that frame risk through the lens of what is an acceptable likelihood of success in achieving the organisation’s key objectives across all functions may have other benefits, too. Improved decision-making, better return on investment, improved profitability, and better customer experience may just be the beginning.
When risk presents an opportunity to reset
Operating amidst a pandemic – while challenging on many fronts – creates a prime opportunity for organisations to reset their approach to risk management in ways that may have continuing returns long after COVID-19 is a distant memory. This dynamic period of heightened risk and prolonged uncertainty may well have already blurred the lines between your organisation’s business-as-usual or compliance-style approach to risk and crisis management response; in many cases we have observed this breaking down of silos to be a spark for innovation, agility and resilience. Consequently, we’ve seen a surge in demand for risk specialists since the pandemic took hold. The key feature in this moment that can enable a ‘risk reset’ is the emergence of an organisation-wide understanding of risk in relation to strategic objectives, allowing risk specialists within your organisation to get meaningful buy-in from key stakeholders. We’ve seen a shift in several industries from a piecemeal approach to compliance towards the design and implementation of enterprise risk management frameworks focused on organisational resilience more broadly.
What to look for in a risk specialist
Whether your organisation has identified a specific functional need – be that to address known or static risks in the areas of technology, supply chain, operations, finance, conduct, market, reputation/brand, public health, environment – or is ready to appoint a senior risk manager who works dynamically across all of these areas to take a broader strategic view of organisational risk, a risk specialist could well be your smartest strategic hire as you shift towards recovery from this period of pandemic.
Risk management is a highly specialised field, and practitioners will often have experience across a range of industries and sectors. Candidates who demonstrate the ability to take perspectives from other settings and apply them to a new context while also being skilled in rapidly understanding the strategic operating environment of a new organisation – that is, those that have a good balance of qualifications, experience and soft-skills – will be best placed to help your organisation achieve its desired likelihood of strategic success.
Candidates should demonstrate experience in the design, implementation and monitoring of risk management frameworks, and may also have specific qualifications or experience in mitigation strategies, disaster recovery or business continuity plans, strategic planning and other bread-and-butter compliance and governance measures and controls.
If you’re ready to rethink risk in your organisation or are looking to expand your current risk capabilities, reach out to Amanda MacGregor today on 0414 558 214 or email [email protected].