Future risk leaders must be adaptive, says RIMS report

The risk management profession is evolving from a “defensive” approach to one that must offer broader value for an organization, and successful risk leaders must be adaptive, says a new report from RIMS.

The new executive report, The Evolving Role of the Risk Professional, released during the RIMS Canada Conference, looks at the history of risk management and the shift from the traditional approach to a more integrated one and toward enterprise risk management (ERM) practices.

While traditional risk management has focused on the financial needs of the business, and only losses instead of gains, more integrated approaches also emerged that take corporate strategy into account.

Now, enterprise risk management requires a new approach that integrates strategic planning, operational planning and day-to-day activities. 

As that shift happens, more board members may want risk professionals who can take a wider approach, including shaping the risk principles and policies of the organization, defining who is responsible for managing specific risks, and providing a framework for judging the effectiveness of risk-taking, the report suggests.

While many businesses have a risk management department leading the ERM program, others have established chief risk officer (CRO) roles within the management team.

“Regardless of where enterprise risk management is initiated within an organization, the risk professional’s role and responsibilities have evolved over the years to reflect greater visibility with a broader span of focus and value,” Carol Fox, RIMS director of strategic and enterprise risk practice noted in a statement.   “It is abundantly clear that successful future risk leaders must be adaptive, informed and ready for whatever changes the future may bring.”

The full report can be downloaded free from the RIMS website here: http://bit.ly/curims1