New perspectives on risk
The Actuaries Institute held the highly anticipated annual Enterprise Risk Management Seminar on 30 November 2015. Jason Yu reports on insights from Chief Risk Officers, Board members, Risk Analysts, Directors and senior management from a wide range of industries.
After a warm welcome by Josh Corrigan and Brett Riley, the ERM Seminar’s Keynote speaker Jason Breton (pictured below), General Manager from Downer Rail, gave excellent insight into the importance and significance of project risk management. His presentation introduced a new perspective for the audience: to never blindly accept assumptions that are presented, but to always challenge them. Good risk management culture relies on key subject matter experts that can drive and influence processes, Jason said, but it also understands where risk managers fit in the bigger picture.
Briefly after the morning tea, Chris Wallace, CEO of Australian Reinsurance Pool Corporation, presented on terrorism risk management. Chris provided an update on the recent Australian Terrorism alert code change and also described the unpredictable but high-severity nature of terrorism attacks.
To raise awareness of increasing risks to terrorism, Chris displayed an alarm chart showing the increasing frequencies of terrorist activities. This made the audience aware that key risk factors related to terrorism risks are proximity, public access, industry and internal environment.
The next presenter, Rob Daily, Chief Risk Officer of CommInsure offered his intuition into the latest challenges faced in financial risks. Rob stressed the importance of interest rate movement, hedging and understanding past impacts. The key message from Rob was to understand the risks that may lead to insolvency and avoid wasted capital expenditure due to significant overruns or unproductive stranded assets. In managing risk, we need to understand the definition, liquidity, transparency and bad debts.
Our final speaker David Hanna, Chief Risk Officer of Paypal took us on a journey to explore risk management in the digital world. In light of the recent hacking attacks on major service providers, cyber-space risk management has definitely been a key focus in the fast-paced technology world. He emphasized cyber fraud, merchant risk, money laundering and terrorist financing as the four key major risks facing online platforms like Paypal. In addressing these risks, the risk management strategies can be unique such as tracking IP address and identifying geolocation anomalies.
The presentations were followed by a Q&A session filled with many interesting questions, including the aggressive approach by Uber into the Australian market and challenge to build risk culture into a company.
Overall, the event was a success and the guests thoroughly enjoyed the thought provoking presentations as well as the networking opportunities. My key takeaway from the Seminar is that with the increasing awareness and need of risk management, the traditional approach of ticking off risks from the risk register is ineffective. Therefore, the future focus of risk management should be on the ability to understand the cross functionality between risk management and strategic alignment of risks.
CPD: Actuaries Institute Members can claim two CPD points for every hour of reading articles on Actuaries Digital.