Counterparty risk, cyber criminals, political upheaval, the economic crisis and human resources, are Amrae chairman Gilbert Canameras’ top concerns right now
As the economic climate gets even darker, companies are having to face growing constraints. What are the top five risks for French risk managers? How mature is the profession in France? What are the key challenges it faces? A view from Gilbert Canameras, chairman of the French Risk Managers Association (Amrae).
Recent events in the world are clearly an illustration that companies are faced with an environment that is getting increasingly risky, are they not?
Indeed, the current situation is rather contradictory. We live in a society that is proving to be more and more risk averse yet the worldwide context is one of more and more “exposure” to risk. This goes to show that the founders of Amrae had a splendid idea when they decided to bring risk management over from the US and adapt it to the French culture. Today’s climate shows up the total justification, brilliance, maturity and appropriateness of risk management.
What are the key risks right now?
If I were to draw up a top five then I would say first of all the counterparty risk, which is directly linked to the economic and financial climate and which, in essence, means guaranteeing the reliability of your company’s partners, suppliers and sub-contractors. After that I would say cyber criminality. Although fraud and malicious acts are not new, the all pervasiveness of IT systems in the company’s organisation means that an attack can lead to paralysis. Then, of course, you must include natural and political events (political events being a consequence of the economic situation). Then I would certainly mention the HR risk especially the “French” psycho-social risk.
You haven’t put any structural risks in your ranking…
Sure, you could also include in your top five risks the consequence of events that occur within the organisation. Here I’m thinking of the company’s reputation and the knock-on effect of damage to your brand or image. In our communication society where the circulation of information has picked up in speed - and is practically instantaneous - an event that is badly managed can have catastrophic consequences. Then come legal and tax risks. Finally, to complete the picture there are the risks generated by the new competition from emerging nations.
What is the main challenge facing risk managers in the years to come?
After having taken stock of the situation, risk managers should demonstrate that their primary assignment is not just to make sure the organisation is regulator compliant but that the risk manager creates added value. This is relatively easy to substantiate… Let’s assume, by way of example, that you are managing a large project abroad - the setting up of a production facility or a refinery. A risk management approach means analysing each individual phase in a transverse fashion, i.e. all risk factors, their consequences and potential impact on costs. With this method you can prevent a project put at three billion Euros from costing four billion in the end.
What project is Amrae currently working on?
The problems of risk management concern everybody. Now that Amrae covers all companies in the CAC 40 and the SBF 120 it should be turning its attention to the world of small and medium sized businesses (SMEs). The advantage of risk management is its adaptability so this should not prove too difficult. Risk management is a thought structure that can be modulated to suit the business, size and objectives of any company organisation. So it is up to Amrae to supply all French companies with their risk management “kit”.