The Institute of Risk Management South Africa: 2020 Risks

The Institute of Risk Management South Africa (IRMSA) is looking forward to
the launch of their IRMSA South Africa Risk Report 2020 on 18 February. 
This will be the sixth edition of this report and looking back over the past
five editions it is disappointing to see that so many risks have
materialised. 

Disappointing because first, the South Africa and Industry risk profiles
have remained largely the same and most of them materialised over this period –
so the risks were well known and yet the risk responses were overall ineffective
says Christopher Palm, Chief Risk Advisor at the IRMSA.

The risks, which include unemployment, fraud and corruption, income
disparity and failure of governance, have not just already materialised, it has
actually deteriorated e.g. unemployment. 

Looking ahead, risks that are making its way onto the South African and
Industry risk radar are climate change, which has sporadically been included on
South Africa’s risk profile, social disobedience, and pressure on South
Africans’ Chapter 9 institutions, which include the Public Protector and the
South Africa Human Rights Commission.

“South Africa needs effective Chapter 9 institutions who uphold and enhance
democracy on our behalf.  IRMSA believes that a strong, ethical and
independent leadership that visibly holds key role players accountable within
the roles they have been voted into, is needed,” says Palm.

International lessonsWhile the risk profession in South Africa isn’t lagging behind its
international peers, board members, executive committees and CEOs of South
African organisations should expect more from their risk managers. 

This is however a “Tango” – Business must actively involve their risk
managers (not just expect of or enable them to tick the boxes), and to actively
be exposed to the business-critical information so that they can bring value to
decisions.

“Internationally, a risk manager will not be appointed if they cannot add
value to the organisation’s performance. Risk managers are expected to
confidently comment on the strategy and performance of an organisation and
contribute to the company’s agility by delivering quality, timeous and relevant
information.  Local companies should demand more from risk managers, and
we should deliver,” says Palm.

“For example, a risk manager with quantitative analytics skills who takes
this approach can be more predictive and support the business’ strategy with
alternative futures, which will lead to better decision-making. If businesses
know what their options are and these options have been quantified, it gets
easier to make the right decisions,” says Palm.

He says the risk manager who adds the most value to an organisation’s
performance is the one who has accepted the notion that risk is about the
future and that uncertainty is not confined to a risk register but that the
integration of strategy, risk and resilience is a critical next step, if not
already adopted.

Reflecting on the risks that have materialised over the past five years,
many things have to be done differently.  The first is ethical leadership,
accompanied by pervasive and persistent accountability and consequence
management.  A very critical paradigm shift required by leadership is that
risk responses that were effective in the past are not guaranteed to address
the risks and opportunities of the future,” says Palm.

Thriving in a dynamic environmentPalm concludes by saying there are three key requirements for companies
to do more of the good, less of the bad and grow resilience to thrive in an
ever-changing landscape.

“Firstly, everyone needs to start talking about strategy, risk and resilience. Secondly, we need to clearly understand who our stakeholders are, the rules they play by, and the context in which this will happen. Lastly, organisations will need more agility and robustness in their governance processes.”

MEDIA CONTACT: Rosa-Mari, 060 995 6277, rosa-mari@thatpoint.co.za, www.atthatpoint.co.za 

For more information on IRMSA please visit:Website: https://www.irmsa.org.za/

Twitter: https://twitter.com/IRMSAInsight

Facebook: https://www.facebook.com/IRMSAInsight/?ref=hl

LinkedIn: https://www.linkedin.com/company/irmsa-institute-of-risk-management-sa/