Corporate risk now at critical level in South Africa

As South Africa enters a new adjusted level-three Covid-19 lockdown, its critical businesses have been re-evaluating their risk strategies with concerns for the year ahead. Gillian le Cordeur, chief executive officer of the Institute of Risk Management South Africa (IRMSA), said the government was left with little choice but to act even though the impact on the economy and jobs will be devastating if the new measures remain in place for a protracted period. Ms Le Cordeur said: “With the speed that the new Covid-19 [strain] is moving and infecting people, the President had to move quickly. It’s now up to all of us to make sure we abide by the new protocols to bring down the rampant spread of the virus. “Before the 2021 business year begins in earnest, corporate leaders need to redouble their efforts in protecting their employees and making sure they have the right risk mitigation strategies in place. Regrettably, many of us fell victim to ‘pandemic fatigue’ and carefully laid plans at the beginning of 2020 simply fell by the wayside. Companies need to revisit and re-implement those plans before we head back to work in early January.” Ms Le Cordeur suggested that, ideally, risk officers should have new plans in place that immediately look at which staff are most vulnerable; how and where they will start the work year; and how the process will be managed to ensure maximum compliance without impacting output and productivity. “Many of us thought that with the turn of a calendar year, everything would go back to normal. That is obviously not the case and companies need to understand that their risk levels are now higher than at any time since the start of the national lockdown,” she said. Ms Le Cordeur added that, once staff needs have been taken care of, a more intensive high-level business risk assessment is the next urgent step. This entails identifying and prioritising critical parts of the business that are vulnerable to the virus and making sure mitigation steps are taken. Vital to this process is also an external focus, where the entire supply chain is audited and weak points identified and dealt with. She said many companies will have to dig deep and find the courage and inner strength to deal with the new variant and the tough new adjusted level-three measures. “This is not going to be an easy first quarter for businesses. With a constant eye on revenue and cashflow, leaders will also have to think about adopting new technology, possibly looking at new suppliers if existing ones cannot meet strict safety standards and even building relationships with a new segment of customers,” she commented. Ms Le Cordeur said the discipline of risk management now more than ever needs to be embraced at board and exco level; and recommendations should be listened to, interrogated and implemented to ensure commercial survival in what is shaping up to be another uncertain year.

Corporate risk now at critical level in South Africa

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