Risk Frontiers Asia: Opportunity knocks
Franck Baron deserves huge credit for leading the creation of Parima back in 2013 after he moved over from Europe to Singapore to take over as group general manager – risk management & insurance at International SOS in September 2011.
Baron, previously risk manager for Swiss fragrance multinational Firmenich (now dsm-firmenich) and French conglomerate Danone, was always an enthusiastic supporter of associations.
He was a member of French risk management association Ferma and then board member at Swiss association SIRM.
His communication skills and enthusiasm for the profession saw him voted as vice-president of the Federation of European Risk Management Associations (Ferma) and he seemed destined to take over as president at some point.
But life changed, as it does, and Baron “crossed the divide” to work for AXA as global business development manager from 2009 till 2011 before arriving in Singapore with International SOS.
Having returned to the risk management fold, he of course did not hang around, teaming up with Steve Tunstall and his then-deputy at International SOS Kelvin Wu and hatching the plan to create Parima.
It was a grand plan as Asia is, of course, a huge and very diverse region. The risk and insurance management profession in the region was at an early stage of development and, in most countries, firmly locked still within the procurement department and mindset.
Arguably, the most advanced risk management communities were in Japan, Malaysia and Singapore. But following the international credit crisis of 2008-2009, risk management in its broadest sense was beginning to encroach on the boardroom agenda across the region and the winds were set fair for the new association.
There was also clearly a need for a more holistic and sophisticated approach to insurance management, ideally involving international programmes and captives that Baron and his colleagues have pursued relentlessly, ultimately leading to the creation of the Captive Insurance Association Singapore last year by Baron and Tunstall.
Baron handed over the Parima leadership to Annacel Natividad last year to move ‘upstairs’ to lead the International Federation of Risk & Insurance Management Associations (Ifrima).
He hopes he can help turn the body into the true international voice of the corporate risk and insurance management community, as the profession and its partners in the insurance sector face up to truly global and interconnected risks that need global solutions.
For Baron, such unity of purpose is critical and the very reason why Parima was created in the first place. “I joined Parima as a founding member. I truly believe that our risk management community can only improve by getting together and embarking on a journey towards greater proficiency, seniority, and sophistication,” he said.
The role of the risk manager has changed quite significantly in recent times, first driven by the financial crisis of 2008-2009, then the Covid-19 pandemic. Now that we live in the era of permacrisis, the profile of the discipline can only continue to rise.
“I am proudly witnessing a community gradually convinced that they belong to a profession. I saw many members benefiting from best practice sharing and guidance from advanced peers. The Covid-19 crisis did raise the value and profile of the profession despite a variety of development in the APAC countries. This crisis also stressed the importance and relevancy of Parima as it brought a place (even remote and digital) for them to continue to learn and share,” said Baron.
It is exceptionally rare to interview an individual working in corporate risk and insurance industry who planned to do so when they left school or university. Franck Baron is perhaps a rare exception.
“I became a risk manager thanks to the creation of the dedicated master degree in France. I was excited about joining a brand new profession in the very early 90s,” explained Baron.
He said that it was exciting to be involved at the early stage of the profession as it began to emerge from the insurance procurement office and into the wider strategic management environment.
“I liked that this was a new profession where a lot was still to be invented and created. At the beginning of my career, the most challenging aspect was that it was too much insurance focused with no reporting line/access to the c-suite, and that the room for young professionals was very limited then,” he said.
And for this core reason, risk management is now a very good option for a young person, in his view. “Definitely it’s a good option. There is still so much to do. The room for innovation is huge and it is one of the few professions that can help with the management of critical risks like climate change, geopolitical volatility and health-related risks,” explained the Ifrima president.
One significant way in which the risk management profession is evolving is in the field of sustainability and ESG, and Baron is, not surprisingly, fully involved with this rising element.
“I am part of the group sustainability/ESG team. We are stressing ESG risks in our risk management activities. Our captive is one of very few that have joined the UNEPFI initiatives and it is supporting concretely ESG initiatives internally,” he explained.
For some, the rise of ESG is just another headache that brings little more than a box-ticking exercise. Baron does not see it that way. “This will be a positive trend if we avoid the greenwashing and the transformation of ESG into a compliance and administrative process,” he said.
Baron is, however, one of the many risk and insurance managers in Asia and worldwide who is frustrated by the lack of progress being made with ESG from an insurance perspective, and sees much room for improvement.
“Very frustrating so far as we have found the market not that interested in our ESG efforts. We saw also some industry players leveraging on ESG to stop underwriting certain risks, or industries denying the importance of supporting the transition. How could and should this evolve to ensure that you receive credit for your ESG efforts? I do not know yet, but on my end as CEO of our captive, I am evaluating the ESG performance of my insurers and reinsurers as a part of our ESG plan,” he said.
Another important area is the rise of AI and how it can both impact the corporate risk profile and be used to more effectively manage risk. Baron sees it as a way to “power up” risk management rather than a threat.
“Much good can happen for risk managers by leveraging on this new technology – a way to power up your risk management. This is what we do in my team at International SOS. I have appointed a data & tech lead and we have developed a GenAI-risk management solution,” he said.
* This interview forms part of a series with leading Parima members carried out by Commercial Risk Asia for its Risk Frontiers Asia survey. Sponsored by HDI Global, the final survey will be published in time for Parima’s third event of the year in Taipei in November.