How Technology Can Help with Risk Management

It’s a dangerous world out there, as evidenced by the year-on-year increase in chief risk officer appointments confirmed in our Global Risk Landscape 2022 survey. Having a chief risk officer (CRO) on the board can certainly help businesses be more alive and responsive to threats. 

However, a CRO is only as good as their team and its processes. Risk is a vast subject, covering areas as diverse as cyber security, supply chain disruption and natural disasters. How can CROs make sure all risks are accounted for and dealt with? 

This is far from an academic question, not only because corporate risks can have a catastrophic impact on business operations but also because regulatory pressures are growing on companies to demonstrate they have appropriate risk mitigation measures in place.

Corporate governance 

In March 2021, for example, the Department for Business, Energy & Industrial Strategy published a white paper called Restoring trust in audit and corporate governance that demands the highest levels of risk reporting to date, from the widest range of businesses. 

What this means for CROs is that a failure to report accurately on risk could become a risk itself. To help avoid such situations, it is worth considering tools that go beyond the standard Excel spreadsheet. 

Integrated platforms can support organizations in implementing and maintaining robust risk, control and assurance frameworks that fit their needs. The outcome can effectively help you embed ownership, management and accountability for risk and control throughout your organization. 

What are the benefits of using a risk management platform? 

The advantage of using an integrated platform over a spreadsheet or document-based risk register is that it prevents situations where measures to deal with risks get left on the shelf.

Spreadsheets do not handle one-to-many relationships. Generally, someone updates a spreadsheet, then it will be sitting on their network drive, and it may remain untouched until somebody asks for it.

Similarly, spreadsheets are not ideal when it comes to capturing multiple responses to a single risk or a single response that addresses multiple risks, which, other than in the straightforward businesses, you will inevitably have.

A platform can easily track such complex risk-and-response interactions and is purpose-built to stimulate actions that reduce risks across the organization. Once a risk has been identified, the steps that need to be taken to manage it can be allocated to named people within the business. 

The system keeps track of their progress in completing the steps, for example issuing reminders related to key milestones. This makes it easy to see how an organization's risks have changed over time, something else that is hard to achieve through a spreadsheet. 

Furthermore, it acts as a single source of truth regarding risk, which makes reporting easier and more accurate. Finally, platforms are designed to make things simple for the user. 

Read more about the Global Risk Landscape results or learn more about continuous risk monitoring solutions.

This content was originally published by BDO United Kingdom.