Over the past three years of the financial crisis, there's no doubt that C-Suite expectations of the risk management function have grown.
What's more, I've also seen a growing appreciation for the integration of risk management
But, how do risk managers feel about these trends? Are their expectations simpatico with those of C-level execs?
A new survey by Marsh and RIMS looked for answers to those questions and found some agreement and some disconnect, too.
The eighth annual Excellence in Risk Management study, which polled 1,022 risk managers and C-suite, finance, and other executives involved in risk-related functions, revealed that the vast majority (80 percent) agreed that senior leadership's expectations of their organization's risk management departments have grown over the past three years. They also agreed that companies expect there to be deeper integration of risk management across the enterprise.
However, when asked about specific action steps to reach these goals, the study detected some areas of disconnect.
The C-suite expects risk managers to step up and take a more active role in integrating enterprise-wide risk management with their organizations' broader strategic goals. Specifically, C-suite executives polled said they want risk managers to:
integrate deeper with operations (61 percent)
execute day-to-day activities more efficiently (60 percent)
lead enterprise risk management activities within the organization (58 percent)
provide better quantification and analysis on risk management, develop greater understanding of non-insurance risks and increase their involvement in the organizations' overall business strategic planning efforts (54 percent)
Based on the survey results, it's fair to say that risk managers think a little differently. For example, risk managers were much more likely to say that risk management needs to be involved earlier in the strategic planning process; that senior management needs to increase its support of the function; and that communication between risk managers and senior management needs to improve in order for risk issues to be better integrated into overall strategic planning efforts.
For Carol Fox, Director of Strategic and Enterprise Risk Practice for RIMS, this disconnect doesn't necessarily bode trouble. Instead, she sees it as an opportunity to enhance risk management functions throughout the enterprise.
"Clearly, the opportunities are there for risk managers to become stronger leaders within their organizations," she explained. "Risk managers needn't wait for an invitation. Rather, seeking opportunities for involvement in strategic initiatives and fostering deeper collaboration across siloed' functions will demonstrate risk management's value in advancing the organization's strategic and operational objectives, just as the C-suite expects."