Reimagining the risk intelligent enterprise

The importance of risk intelligence

Is your organization taking a proactive approach to risk management? Many aren’t. Despite the advancements in risk management over the last 10 years, many leadership teams still lack a clear picture of the risks to their organizations and reliable ways of addressing them.

Leaders who adopt the practices of a risk intelligent enterprise have a sharper vision of risks and opportunities. The risk intelligent enterprise acknowledges that risk management must evolve as risks evolve. And it understands that traditional enterprise risk management isn’t enough. To get ahead of disruptive risk, organizations need to develop a proactive risk management program.

The risk intelligent enterprise:

• Pursues the opportunities that risk presents while protecting existing assets
• Creates strategic flexibility while maintaining operational discipline
• Increases senior executives’ confidence in their decisions
• Provides assurance to the board that risks have been addressed

Inside a risk intelligent enterprise

The risk intelligent enterprise aligns people, process, tools, technologies, and governance into one system. From there, it prioritizes and allocates scarce resources to the highest return opportunities. The risk intelligent enterprise relies on three foundational elements:

1. Risk management system. A technology-enabled platform that combines human expertise with risk data and analytics to generate risk intelligence.
2. Integrated assurance program. An integrated assurance framework, methodology, and system align risk-reporting and assurance activities across all three lines of defense to enhance risk management effectiveness.
3. Effective governance. A governance framework consists of structures that enable management to execute the preferred strategy within commercial and regulatory boundaries of operation.

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Is it time to rethink your approach to risk intelligence?

Organizations that have evolved their approach to risk have embraced analytics, technologies, and innovations that harness data, expertise, and experience to drive a broader, more nuanced view of risk. And they’ve often prospered by shedding unnecessary costs and activities while leveraging risk for competitive advantage.

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