Risk managers must seize opportunities ahead

New laws will soon force French companies to take greater corporate responsibility but firms are already moving in this direction as they recognise it is a more sustainable business approach, according to a group of AMRAE board members meeting in Paris for CRE’s 2019 Risk Frontiers Europe survey. They said this and other trends are creating huge opportunity for the risk profession. The French government introduced a company law in June that requires businesses to take on greater corporate responsibility. Speaking as AMRAE president, Brigitte Bouquot risk manager for Thales, applauded the way in which this new regulation has put corporate social responsibility at the heart of company practices. She believes this will help put risk management policies at the core of business and strategic decision-making going forward. “There is a uniform approach in France, which is developing across Europe, that businesses are more responsible,” said Ms Bouquot, who suggested that risk management has a central role to play. “You cannot be responsible without a real risk management policy, otherwise it could be just window dressing and, at best, a tickbox on compliance,” she argued. The group of risk managers agreed the new French law is a huge fillip for the risk management profession and will result in risk managers playing an ever more crucial role. As Ms Bouquot said: “It is about investing not just in sprinklers and fire protection but to invest wholly in risk management policies that include emerging risks such as cyber and ethical questions." “It is about investing sustainability, not in the old financial way but in a new way. It is a question of giving resources to risk management policies, because it is now a matter of reputation,” she added. Ms Bouquot does not underestimate the challenge this presents to individual risk managers. They all need to step up, she said. One of the keys to a sustainable future will be the ability of companies to adapt and thrive as climate change impacts their locations. Again, François Malan, chief risk and compliance officer at Eiffage, believes risk managers will have an increasing important role to play. “Risk management-mapping methodologies will be extremely useful in helping companies to work out the possible consequences of climate change… We can contribute to product development, for example, as companies look to create new products to cater for new circumstances,” he said. Cécile Bellord, risk manager at Louis Dreyfus Armateurs, agreed with others that risk managers have a unique opportunity to influence internal policies within their companies. “But it is very important risk managers focus on solutions, for example when considering sanctions and new regulations and so on,” she said. Adding: “Risk managers sit on a bank of information that can help the executive committee form their strategies.” Another AMRAE board member said risk management “is one of those functions where we have a 360˚ around the business – and a view of the horizon ahead”. Ms Bouquot said transformation was at the centre of AMRAE’s annual conference this year, but is not an issue to be addressed once and then left. “There is a first level of transformation, in which a company needs to become resilient so it can remain sustainable,” said Ms Bouquot. However, she said there is a new emphasis in France on a second level of transformation, during which companies need to look at why they are doing what they are doing – their purpose. And France is undergoing a transition of business structures. Many businesses were historically family owned and ran, with the CEO effectively governing the risk management function. But now more companies are taking on risk managers, who have to help them transition from that family way of thinking to a more corporate world. This also provides opportunity for risk managers to prove their value at the heart of every business, the Risk Frontiers Europe survey participants said. AMRAE board member Philippe Noirot pointed to the way that broader society is viewing environmental, social and governance issues. He stressed that corporate social responsibility is now a key competency within any business, and no longer a “nice to have”. “It will not just be about the risks of human capital but also the risks created by increased automation and digitalisation within the workplace. We will have to bring our young people into the board so older generations can fully understand the dynamics of Generation Z, for example,” added Eiffage’s Mr Malan. Ms Bouquot stressed the risks businesses face if they ignore the disruptive power of youth, and the speed with which change can come. “Risk managers can open their executives’ eyes with regard to this. It is no longer business as usual and companies have to adapt fast. The world is changing and we are facing a very disruptive period of time. There is an issue of climate change and there is the issue of technology. There are parts of the world where people are fighting because of social injustice. Young people are a part of what is happening and we have to factor that into our risk awareness.” The survey participants agreed that curiosity is crucial for risk managers to succeed. They said risk managers have to ask questions and want to see into all parts of the business if they are to get a full understanding of the risks. “You need to be curious about what is happening in the business. You must use social media… and use AMRAE to ensure best practice and to remain up to date with your professional requirements. But a connection to the business is the most important part,” said Mr Malan. Those meeting in Paris said risk managers can sometimes operate in their own bubbles and often without the support of a team around them. This is why it is so important to be a member of a professional association and have the chance to interact with peers, they added.

Risk managers must seize opportunities ahead

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