Risk management is not the responsibility of a single department. It is the responsibility of everyone, from the chief executive down. Past corporate failings have been attributed to lack of accountability, strategy and transparency.
Tougher expectations by regulators and other stakeholders now mean that corporates and financial institutions should demonstrate better discipline, control and responsibility. Failure to keep on top of and comply with existing and emerging regulation could jeopardise reputations and livelihoods. How robust is your governance, risk and compliance program?
Managing risk
Financial and conduct risks have never been more acute. Capital reserves, credit portfolios, investment policies and capital and debt profiles all demand constant scrutiny to adequately manage and mitigate risk.
Companies should also be vigilant about risks presented by suppliers. A counterparty who defaults on a contract, or whose business collapses, can have serious financial and reputational ramifications for connected parties.
Cyber risk can also increase when cash is tight. Some employees become more opportunistic and external hackers more resourceful. They find gaps in security controls in areas of the business. Are your systems and policies sufficiently robust?
With all these demands, internal audit is in many companies often elevated from pure compliance to a function that regularly reviews the risk profile for emerging risks and identifies trends. The chief risk officer, meanwhile, has become increasingly involved in strategic decision-making where the emphasis is as much on risk as it is on growth.
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The pace of change is challenging leaders like never before. To find out more about how KPMG perspectives and fresh thinking can help you focus on what’s next for your business or organisation, please get in touch with our team below. We’d be delighted to hear from you.
