Responding to Systemic Failures

An interesting comment from a respected senior associate today is worth pondering on:

Am guessing/hoping this [Systemic Risk] is directly in your wheelhouse & not sure how ISO 31000 deals with it as it involves or influences multiple systems within a sector or industry.

In my world, this type of issue is viewed as an external influence which essentially sidelines what should be considered a strategic risk.

Would be interested to see your thoughts on your site or in the group.

Emerging Markets Workplace Safety

When a typical person from the developed world asks me about risk management practices in the emerging markets, I have this sense they just don't quite grasp what we are dealing with much of the time as risk managers. Over the years I have amassed some of the most incredible and unbelievable stories of dysfunction, yet ... society kind of works it all out pieced together by a thread. Much of the madness that goes on is unfathomable unless you see it with your own eyes, if you are looking out for it that is.

Just as a typical example; on my way to a risk management meeting of all things with a bank this morning, I was presented with a couple of images which starkly represent what I mean when I say risk management in the emerging markets has its challenges.

RMA Credit Risk Brown Bag

If you are in Singapore on the 17th of September and you work in the world of credit risk, this RMA credit risk program looks like an interesting presentation to attend.

Assessing uncertainty is full of error

Our recent article on the risk matrix [LINK] is all fine but the concept of a risk matrix from the outset seems to embody much of what is wrong in risk management today, let me elaborate on all of this for a moment.

Making A Risk Matrix Useful

A recent debate on the G31000 forum titled "Test your Risk Matrix" isn't the first time this contentious subject of Risk Matrices has been debated between practitioners and, I doubt it will be the last.  The use of a Risk Matrix, which we will explain in this blog article, is broadly popular among enterprise risk managers looking to report aggregated and enterprise-wide view of exposures that threaten their stakeholders.  Those that use risk software systems often find that the Risk Matrix comes installed as part of the package and I know some practitioners out there wouldn't procure a risk solution unless this type of report was available from the outset.

The Risk Matrix is a bit of FAIL though and it generally does not yield to the industry of risk management what it promises. Some seasoned risk analysts are so disgruntled with the tool that they choose to drop the whole reporting concept altogether.  That is all fine but it doesn't detract from the requirement that stakeholders are going to ask for a summarized view of their risks at some point in time and as it stands, many of them have become accustomed to seeing their world of risks in a matrix.

Disbanding the Risk Matrix to the rubbish bin doesn't seem a viable solution for avoiding its problems, unless something better comes along. So then, let's tackle its flaws and try to resolve them.

Australian and Canadian Bank Risk Culture Examined

An interesting study on the internal "Risk Governance Culture and Behaviour" of Australian and Canadian banks has recently been published by Elizabeth Sheedy and Barbara Griffin from the Faculty of Business and Economics at Macquarie University [LINK].

There are some curious insights to be found after surveying 22,145 employees of 222 various business units in six major banks headquartered across two countries and, I have plucked out some of these findings or perhaps their interpretations in this short blog posting.

The world has to leap for a second

It is official, the leap year is just not enough.  Analysts have known for a while but fearing the worse that the worlds rotation is slowing down, even though life is speeding up, scientists need to find a way to keep everything in sync. With all of this in mind, the time lords in charge of this planet's official time system have decided to add an extra second into the year.

This time tampering is referred to as the leap second.

This is not some tomfoolery on April the 1st, nor is it February the 30th but it is going to happen tomorrow on June 30th this year.

Can you really change the culture of banking?

George Osborn and Mark Carney are determined that the culture of banking as it has become accepted by the community at large, although deeply criticised over the years, can actually change.

The importance of ISO 31000 in Germanwings

The article "The Germanwings crash and, the folly of risk analysis" shows to me at least, why the global risk standard of ISO 31000 is so vital to the people of this planet.

I will elaborate for a moment ...

Valuation Steps Part 2

A couple of days ago I published an article that mapped out the efforts required to perform a complete valuation of a new project or entity, and that article [LINK] seemed to have generated a lot of curiosity.  In this sequel to the Valuation Steps posting, we are going to take a slightly deeper look at how to identify specific the parameters which are needed to perform a Discounted Cash Flow valuation.

Valuation Steps

Product managers, corporate risk assessors, project managers, project financiers and many other types of business analysts often need to value uncertainty in their business strategies. In this small blog posting we take a look at the steps that would generally be followed for a typical sound valuation of 'corporate risk'.

Financially Evolving Big Pharma

Working with a wonderful group of industry experts at the huge Bio Pharma event in Singapore. Our presentation can be found at the end of this blog.

Pillar III Reports go through a makeover

The bank for International Settlements has been very busy over the last few months publishing amendments to both Basel II and Basel III, and it was only a matter of time before Pillar III was swung in for a similar maker over.