October 4, 2004 by Canadian Underwriter
“Carpe diem”. Seize the day. Risk managers are enjoying a moment in the spotlight and now is the time to break down the corporate “silos” and push enterprise-wide risk management (ERM) to the board level. So say speakers at the 29th annual RIMS Canada Conference in Winnipeg, Manitoba on Monday.
Risk managers must “expand upon their traditional roles”, says Bill Kelly, director at Pricewaterhouse Coopers LLP and past president of the Risk & Insurance Management Society (RIMS). “If we, as risk managers, are to enhance our contribution, we must enter into new territory and command the respect and recognition of the members of management who are completely outside our community.”
One stumbling block is the lack of advanced professional degrees amongst risk managers, he says – while the Risk Fellow (RF) designation is making progress in Canada, he is less optimistic about its progress in the U.S. Another challenge will be to better manage relationships with intermediaries – to take advantage of their resources while not becoming dependent on them.
Overcoming these challenges is necessary if risk managers are to make ERM a reality, and to make risk management “an integral part of [your] firm’s value proposition”, Kelly says.
This is a time of “unprecedented interest” in risk management, adds Tim Leech, principal consultant for Paisley Consulting. ERM practitioners can reap the rewards in terms of stature and wages, he explains, “because the consequence of not managing risk and insurance is enormous” for corporations. “Risk management practitioners that maintain and defend old style risk management silos will be marginalized,” he adds.
Both speakers pointed to recent guidance risk managers can access around ERM, including the COSO framework and portions of the Basel Accord relating to operational risk.