Learning from each other

Last year, Tsitsi Chitsamatanga participated in our Risk Frontiers Africa survey along with more than 900 other risk managers and 450 individuals from the world of risk transfer. One of the participants would win a trip to Europe to attend an event organised by Commercial Risk Africa’s sister paper Commercial Risk Europe. Ms Chitsamatanga was picked from the hat as the lucky winner. We caught up with the Zimbabwean during her three-night trip to Brussels to find out what she made of the experience, learnt from the conference and how knowledge can be shared between the global risk community. We also discussed the state of risk management in Africa and the current risk landscape in her native Zimbabwe. Tsitsi Chitsamatanga was welcomed to Brussels by the Commercial Risk Europe team last November to attend its Risk Frontiers: The New Unknown conference and European Risk Management Awards gala dinner. She was pleased that the weather was not as cold as expected and extolled the virtues of the event as an opportunity for the risk community to come together, share knowledge and work towards a better future. The African risk manager was also adamant that there is much that can be shared between risk professionals in her continent and in Europe. “I am pleased to report that the weather is not as cold as I expected. I came with a suitcase full of warm clothes but most were not needed. I was able to spend a day going into Brussels to look around the city, which was very enjoyable,” said Ms Chitsamatanga. “It was such a wonderful event and informative, where European risk professionals and insurance professionals came together to engage and share knowledge. It is a very good initiative to help risk managers succeed,” she added. One of her key takeaways from the event was that risk managers cannot succeed alone. They must share insights with each other through forums such the conference in Brussels and other opportunities afforded by associations and, in her part of the world, Commercial Risk Africa, she said. “You need to share with and learn from others, because what keeps you awake at night is the same as risk professionals in other nations and organisations. Sharing risk knowledge and experience is of paramount importance for risk managers to succeed in this volatile environment. I learnt that whether you are in Africa or Europe we all have the same concerns, and it is vital to come together and help each other,” Ms Chitsamatanga said. In a world that is becoming increasingly connected, the risks that affect risk managers in Africa also affect those in Europe, she continued. Regardless of where risk managers are based, they can share information on key risks and, crucially, their mitigation strategies, she added. There is little difference between the risk models and physical mitigation strategies used across different continents, Ms Chitsamatanga stressed. However, when it comes to using insurance the approach differs greatly between Africa and Europe, she explained. “The only real difference is the use of insurance as a mitigation strategy. Insurance is not as fully utilised as a mitigating measure in Africa as it is in Europe, where insurance is a big mitigating strategy for risk managers,” she said. This is one area where African organisations can learn a lot from their European peers, she added. “There could be information passed onto Africa risk managers about how European risk managers buy insurance, so that we can learn how to better use this risk mitigation strategy. “Risk managers in Africa need to learn how to use insurance to transfer some of their risks and develop that strategy. This is definitely something that we need to learn from our colleagues across the world. We have an insurance market but it is not being fully utilised,” said Ms Chitsamatanga. This is mainly due to a lack of knowledge on the benefits of insurance among African risk managers and their companies, she explained. “Organisations know that it is an option but it is traditionally used to only insure tangible assets. It is for intangible risks that we need to develop an insurance-buying knowledge base and culture,” she added. Risk management Outside of insurance, Ms Chitsamatanga is pleased to report that risk management is advancing in Africa and Zimbabwe. “It is definitely going in the right direction and advancing – proof of this is my being in Brussels to plug into the knowledge and support on offer around the world,” she pointed out. Commercial Risk Africa is playing a big part in that development, Ms Chitsamatanga said. It is helping to bring the risk community together in the absence of associations and other forums in many parts of Africa, she added. Ms Chitsamatanga hopes we will soon extend our list of African events to her home country of Zimbabwe. “Risk managers come together in Africa through Commercial Risk Africa predominantly. We thank Commercial Risk Africa because you are bringing risk managers in Africa together to share their knowledge and experience. This is a good thing. Commercial Risk Africa has done events in Botswana, Namibia and South Africa – I now really hope to see you in Zimbabwe sometime soon. It would be a good time to have an event in our country,” she enthused. Ms Chitsamatanga also hopes that the Institute of Risk Management will follow through with its plans to set up in Zimbabwe this year to develop the risk profession. Despite the positive direction of travel for risk management in Africa and Zimbabwe, it is not an entirely rosy picture. Cost cutting within company budgets and risk management departments is making things tough and creating new threats. “This is a big challenge we have. When we adapt to cost-cutting measures, other than coming up with other innovative strategies of addressing the issues at hand, we are actually shooting ourselves in the foot. Cost-cutting measures are good strategies to a certain extent but if we continue to resort to cost cutting, we usually compromise the quality of service and as a result we expose our organisations to disrepute,” said Ms Chitsamatanga. Doing business in Zimbabwe is challenging, especially for local companies because of foreign currency shortages. “For locals, it is a difficult environment, especially for those that import products and services from other countries. There is a payment gridlock in our financial sector due to foreign currency shortages,” said Ms Chitsamatanga. But these challenges also present good opportunities for multinationals holding stronger currencies to invest in Zimbabwe, she continued, adding: “I think this is the right time for them to set up their ventures – if they don’t do it now we will do it ourselves.” However, she noted that government policy demanding foreign investors take a 49% ownership in any new Zimbabwean venture, with the rest put in the hands of local firms, is putting many multinationals off and crippling foreign direct investments. “Political risk is one of the biggest risks followed by liquidity risk in Zimbabwe. Increasing compliance demands are another risk. We have extensive regulatory demands and they are growing as a result of foreign currency shortages. This is impacting our business operations,” said Ms Chitsamatanga.

Learning from each other

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