Risk management becoming more involved in critical decision-making: RIMS president

Risk management has become a multi-disciplinary engine of growth and profit, with the discipline crossing all organizations and industries, RIMS president John Phelps said during the opening session of the 2013 RIMS Annual Conference & Exhibition.

With the discipline starting as integrated risk management, then progressing to enterprise risk management (ERM) and now to strategic risk management, “at each stage, we’ve become more and more involved in those critical decisions that determine our company’s success,” Phelps told a packed exhibit hall at 2013 RIMS, being held in Los Angeles from Apr. 21-24, which attracted approximately 10,000 risk management and insurance professionals.

“Over the course of my career, I’ve witnessed the role of the risk professional grow exponentially from a back-room operation to the leather seat in the boardroom,” he reported. “ERM at long last is losing its novelty and expanding beyond the expense side of the income statement to help drive and support strategic opportunities for their companies,” he noted.

“Risk management is a discipline that can be used in any organization and in any industry. That’s because it addresses a central element of every human experience – uncertainty. The objective of risk management is to help people confront that uncertainty by taking calculated risks,” Phelps noted.

“It is the amalgam of the diverse conversation about uncertainty that forges the future of our profession. What this means is more options and more opportunities,” he told attendees.

As more organizations adopt risk management principles, opportunities for risk professionals are more numerous and diverse than ever before, Phelps reported. “Few professionals have such mobility to navigate up, down and across the company, analyzing difficult problems of sometimes enormous complexity to make a real difference in their organization’s success,” he said.

Citing the next generation of leaders, Phelps emphasized, “To ensure that risk management continues to thrive, it is essential for us to present a vibrant vision of the future so that students and young professionals will want to pursue this exciting career.”

Phelps noted the need for veteran risk professionals to help guide, support and mentor younger colleagues to create an environment in which they want to become involved. Citing a personal experience working with a younger professional, he said that “two generations working together in openness and candor can create something that is bigger and greater than anything we could have imagined on our own.”