Risk Institute Executive Director Philip S. Renaud was the La Fleur guest lecturer at Hood College this week where he gave a keynote address on organizational culture and the future of risk management.
“Risk isn’t just insurance, actuarial, cost center, process or program,” says Renaud. “World-class risk management is achieved when an organization treats risk as a value.”
His presentation (which can be viewed here) takes the audience on a journey of risk management practices through the years. From risk transfer, insurance and accounting focus of the 1960s to captives in the 1980s to enterprise risk management and cybercrime mitigation of the present, the risk management professional today is just as likely to have an IT background as an insurance or finance background.
Renaud believes that an organizational culture that’s conscious of risk should look at three things: integrity, commitment and transparency.
“Organizations that are lacking in one or all of these spheres are the same organizations you see on the news for one scandal or another,” says Renaud. “Wells Fargo, BP, United, VW — these are companies who’s lack of transparency and integrity have cost them their good brand reputation, their stock price — not to mention the loss of public trust and in some cases landed their leadership in jail.”
Renaud believes that the future of risk management is bright and filled with opportunities for young professionals entering the field. According to a recent survey from the Risk Management Monitor, more than 60% of risk professionals are 55+ and will be eligible for retirement in the next five years, opening the door for bright, young professionals to move into more senior roles more quickly.
When asked if he could offer one piece of advice to companies on seeking to improve their organizational culture, he said, “Cultivate transparency. A lack of transparency is always viewed as deceit.”
Phil Renaud is the Executive Director of the Risk Institute at The Ohio State University Fisher College of Business. The Risk Institute is a research center bridging the gap between academic research and practitioner experience in enterprise risk management.