Risk management still not fully accepted in the boardroom: Marsh study

Risk management has yet to be fully integrated into the decision-making process at board level among top European businesses, according to a survey conducted by Marsh U.K.
The survey was conducted among risk managers attending the recent annual conference of the Association of Insurance and Risk Managers (AIRMIC) in Edinburgh. The number of delegates surveyed was undisclosed.
AIRMIC represents nearly 1,000 risk managers and corporate insurance buyers.
The survey found only 30% of respondents felt risk management was always or consistently taken into consideration in the strategic decision-making process. Twenty-two per cent felt it never or rarely happened at all.
Asked how they measure the value of risk management, 35% said it was the impact on “cost of risk,” while 25% measured it in terms of reduced incidents or losses.
Only 5% cited reductions in insurance premium. Fourteen per cent said that they did not measure value.
Quantifying risk and demonstrating value were of greatest concern to three-quarters of the delegates; 37% found embedding risk management into their organizations a challenge.
Commenting on the findings of the study, Eddie McLaughlin, leader of Marsh’s risk advisory group for Europe, the Middle East and Africa, said: “It is clear from our research that UK risk managers feel that risk management still has some way to go before achieving full recognition in the boardroom.”