Profile: Continuity in Change

Janice Ochenkowski knows that to succeed in the fast paced world of finance, you have to be willing to change, adapt and grow as a professional. As Ochenkowski prepares to accept the reins of the Risk and Insurance Management Society’s (RIMS) presidency, she reflects on her 27-year career and notes that over the years, the risk management profession as a whole has grown into an integral part of the insurance industry fabric.

Ochenkowski, a Chicago native, began her career in 1980 as the assistant to a risk manager at what was then known as LaSalle Partners. She counts herself lucky, she says, because she joined an organization that she considers to have been ahead of the curve — an organization that placed a heavy premium on risk management before the profession was even formally articulated.

“Once I started to work and attend IRM [The Institute for Risk Management] classes, I realized that risk management was a very interesting job,” she says. “In many respects, the position and I grew to fit each other as our company grew.”

Not long after launching her career, Ochenkowski became the full-time risk manager at LaSalle. Since then, she says, the excitement and challenges have kept on rolling.

Her employer merged with another firm in 1997 to become Jones Lang LaSalle. To date, the property and investment management firm employs more than 26,000 people in more than 50 countries. Ochenkowski serves as vice president and managing director of the firm, as well as director of global risk. More recently, she says, Jones Lang LaSalle has launched initiatives related to the environment and energy, sectors that present new and exciting challenges.

“Although I have stayed with the same organization for years, it seems as though I have worked with several different companies,” she says. “I have to say that being adaptable has probably been the most valuable characteristic that I could have. I have been here since 1980, and I have never been close to being bored.”

CHANGING TIMES

Ochenkowski has watched first-hand the profession grow and become more visible as a discipline within companies. She believes this shift in emphasis in favour of risk management reflects an evolving business environment. “We live in a much riskier world,” she asserts. Corporations and public entities are being asked to assume more risks while the pace of business continues to quicken, she observes.

“Insurance products are becoming much more sophisticated, and the manner in which companies are dealing with risk-related issues is evolving into a much more sophisticated process,” she maintains. “Through all of that, there’s a recognition that talented risk managers can and should be at the forefront of those initiatives.”

Complicating issues even further, the general process of conducting business has undergone a great degree of formalization, Ochenkowski says.

“Sarbanes-Oxley has required the formalization of process and the documentation of compliance,” she says. “So it assists many risk managers within their companies and that formalization is a great help to us.

“Whereas there was a hand-shake deal between business friends much earlier in business practices, that has clearly gone away. We now have to document and understand what we are getting into in each phase of our business and strategize to anticipate what might occur as a result of them.”

This formalization of procedure is for the better, Ochenkowski believes. But she adds the following caveat: although Sarbanes-Oxley has changed the company’s processes for handling risk, it doesn’t directly reduce the company’s exposures, which are increasing.

PASSING THE BATON

As the business world continues to evolve and shift, RIMS will grow with it, Ochenkowski promises. She stresses that one of RIMS’ trademark strengths is that its leadership works very hard to ensure continuity of programs even as its officers are in a state of transition. And on Sept. 1, 2007, when she officially begins her term as the organization’s president, she expects to pick up and carry on where her predecessors have left off.

One initiative, the RIMS Quality Program, will articulate what it means to practice quality risk management. “We’re going to provide tools and guidance to our members,” Ochenkowski explains. “First to help them identify quality risk management, what it is, and then to assist them to move forward on that continuum by providing various tools, templates and resources.”

The three-year quality program has three phases, two of which have already been completed. Each phase relates to one of the three central roles in the purchase of commercial insurance. For example, under Ellen Vinck, the RIMS president in 2005-06, the quality program looked at the role of the insurance broker. Last year, under RIMS president Michael Liebowietz, the focus was on the role of the insurance company and underwriters. During Ochenkowski’s term, the program will focus on the role of the risk manager.

LEGAL EAGLE

Ochenkowski says RIMS will continue to devote resources to the society’s legislative work. “There are several important pieces of legislation that are under construction in the United States that will impact insurance and risk manager,” she says. Under the leadership of Beaumont Vance, a RIMS director, staff and volunteers will work to ensure that legislative leaders know and understand RIMS’ position, she says.

The legislative concerns surround the Surplus Lines Reform Act, Insurance Industry Modernization [and Consumer Protection] Act, and the future of the Terrorism Risk Insurance Act (TRIA).

Where the Surplus Lines Reform Act is concerned, the intent of the legislation is to streamline the regulation of insurers who are not licensed in states where surplus lines insurance is placed, according to information from the RIMS Legislative Action Centre. This same information notes: “The key change sought by the legislation would allow brokers representing large policyholders to go directly to the non-admitted market to seek coverage without having to prove that they had first sought the coverage in the admitted market,” thereby eliminating state premium taxes.

A key prerequisite to qualify for the benefits of the legislation is that the insured had to employ a “qualified risk manager” to work with the broker to place the coverage.

The definition of a “qualified risk manager” has proven to be a point of contention. Last year, RIMS began to work with a government representative to draft an appropriate definition within the bill.

The new definition appeared in the Nonadmitted and Reinsurance Reform Act of 2007, which the U.S. House of Representatives passed by a unanimous vote on June 25, 2007. The act has since been referred to the Banking, Housing and Urban Affairs Committee, and RIMS will monitor any further action.

SPREADING ERM

RIMS is also undertaking an Enterprise Risk Management (ERM) initiative, Ochenkowski notes. “We have White papers, courses and most recently the maturity model, which was a great contribution to the initiative.”

The RIMS Risk Maturity Model is an online resource that provides guidelines and best practices for developing and maintaining effective risk programs. It does this by allowing risk managers to first gauge the maturity of their program. The risk manager can measure the maturity of a risk management program by answering a questionnaire that scores the program based on 25 key characteristics. Once the results are in, the risk manager can compare this assessment against guidelines; based on this, an action plan can be developed to take the program to the next level.

Some RIMS members already embrace ERM, but it remains “a glimpse of things to come for others,” Ochenkowski said in a statement.

She predicts her biggest challenge will be finding the time required to move the initiatives forward and the resources to see all of them through. She believes she will be
successful in this endeavour, however, because she maintains that she’s got a solid and dedicated team within the society to serve as a strong backbone.

“I’m very excited about moving into the presidency of RIMS,” she says from her Chicago office. “I think this is a very exciting time to be involved in leadership. But it’s not a one-person process – a lot of people in the RIMS organization shoulder the load of our initiatives and our projects.”

Her first official role as RIMS president will be when she makes her appearance at the RIMS Canada Conference in Halifax. Already, it’s easy to detect the enthusiasm in her voice. “I can’t wait,” she says. “I’m really looking forward to it.”