Organisations that can understand and manage their risks effectively are better placed to grow, confident they can withstand known and unexpected risks alike.
In an increasingly interconnected, volatile and uncertain world, it’s clear that the risk landscape is changing. The COVID-19 pandemic clearly demonstrates the speed at which risk events occur and the extent to which they spread have risen dramatically. Risks that once seemed improbable and even remote have also become the norm. Business leaders everywhere must now ‘expect the unexpected’.
To navigate through turbulent times, companies need to develop a new trait: resilience. This combines the ability to ride out the immediate impact of shocks with the agility to adapt to constantly changing conditions. Organisations that can understand and manage their risks effectively are better placed to grow, confident they can withstand known and unexpected risks alike.
What does this mean for your business?
An increasing number of businesses are now focusing on risk resilience as well as risk management. They’re exploring new ways of managing unpredictable threats, including collaborating more closely with governments, changing their remuneration schemes to encourage more risk-aware behaviour and breaking down internal barriers to ensure a holistic organisational response to risk.
Many companies are also using scenario planning to get a better understanding of global risks. And they’re adopting new processes and incentives to help close the gap between their strategic and operational risk approaches, and foster a risk-aware culture.
Global Governance Risk Compliance (GRC) and Internal Audit Leader, PwC Australia
Tel: +61 2 8266 3275