African Risk & Insurance Management News
CRA EVENTS IN AFRICA —Watch this space!— As part of its programme of seminars across the continent, Commerical Risk Africa will be staging an event in Lagos, Nigeria
Time for risk managers to take a definitive lead Liz Booth news@commercialriskafrica.com
[gaborone]—Risk managers have a unique opportunity to become risk leaders and guide their organisations into successful futures, according to Julia Graham, President of the Federation of European Risk Management Associations (Ferma). Speaking at the first Risk Frontiers— Southern Africa one day seminar, organised by Commercial Risk Africa, she said company boards have increasing responsibilities across the world and there is an opportunity for risk managers to help support them using their knowledge and experience. Ms Graham said: “To connect people across the organisation, risk managers need integrity and strong values. Risk managers have to be credible and to be able to show the organisation and stakeholders that you know your business.” chance to add value She believed there are plenty of opportunities for risk managers to show off their expertise and to add value to organisations but she said, the need for professional recognition was essential to evidence that value. “We want to call ourselves professionals,” she said “and to do that we must have a career path supported by the evidence provided by exams along the way to ensure we are meeting those professional standards.” Ferma will soon be launching a certification for its members, based on four pillars. She explained that these will include the risk managers’ knowledge, experience, a programme of continuous professional development and adherence to a Code of Ethics. “Professions typically have this type of structure,” she stressed, “whether it be doctors or accountants, for example. We are trying to talk to people about professionalism.” Certification has three component
Julia Graham
parts: certification for risk managers based on their level of knowledge and experience coupled with successful completion of an examination, accreditation for bodies providing further education, including risk management and insurance education, and continuous professional development (CPD) which ensures knowledge and experience are maintained to defined levels. Accreditation is about making sure that the organisation which you get further education from is credible. Organisations which provide CPD, including Ferma member associations, will be licenced to an agreed standard.” Ferma will be launching a two tier route to certification. The first stage will be for those people newer to risk management. Advanced certification will “take it to the next level”, according to Ms Graham. There will be choices along the Advanced route. For example, as part of the Advanced certification, professionals will be able to choose between insurable risk, enterprise and strategic risk management and financial risk management. “Not everyone will take exactly the same path and it is important that we acknowledge that and reflect it in certification,” said Ms Graham. “In large organisations these roles can be quite separate while in smaller organisations one person may perform all these roles. Our certification will cater to all. The key is that our certification is developed by risk managers for risk managers,” she concluded”. That same message came from Gillian le Cordeur, Chief Executive Officer of the Institute of Risk Management South
Africa (Irmsa), who spoke of the success of the first sitting of its board exams last month. She described development of its qualifications as an exciting journey, saying the key had been working together to produce a credible and valued certification process. Irmsa also has a two tier qualification, combining knowledge and experience. She explained Irmsa was registered as a professional body in 2012 as part of a drive to encourage higher education and raise standards. “We needed to ensure standards spoke to what we were doing,” she said. Ms le Cordeur said: “Most risk managers are more likely to have come from audit or maybe the legal side of the business and have fallen into risk management. We need to make sure the journey towards risk management qualifications is valid and worthwhile.” high standards Both organisations place emphasis on continuous professional development (CPD), saying risk managers will need to continually maintain their standards much as other professions demand. Ways in which CPD is maintained continue to be developed but the need to keep abreast of change was highlighted through the day’s seminar with speakers pointing to existing and potential challenges. They said risk managers need to show their value to organisations and, while passing the exams was a vital part of that, CPD was an equally important part of evidencing risk manager’s credibility to their senior managers. Ms le Cordeur explained that Irmsa will be launching its second stage exam later this year, following the successful launch of the Stage 1 exam in June. “We are aiming for about a 60% pass rate. It was important that the exams are a true test of knowledge but it has also been important to reflect the many ways people came into the sector, their education and their experience. We need to be as inclusive as possible while maintaining the right standards.”
Butch Bacani
Insurers and risk managers crucial to UN’s 2030 sustainable development plans Gareth Stokes news@commercialriskafrica.com
[gaborone]—the risk and insurance communities have a key role to play in addressing environmental and social challenges across Sub Saharan Africa, according to a keynote address by a United Nations (UN) representative at the annual Risk Frontiers Southern Africa conference, held on 23 July, 2015 at the Cresta Lodge in Gaborone, Botswana. Butch Bacani, Programme Leader, UN Environment Programme Financial Initiative (UNEP FI) for Sustainable Insurance, started his presentation by providing context for the UN’s participation in the risk management discussion. “We believe that the insurance industry [including risk managers] has a key role to play in addressing many of the environmental and social challenges that the world is facing today and into the future,” he said. The insurance industry is the cornerstone of the global economy, acting both as a shock absorber when unfortunate events and losses occur and as an investor with assets under management totalling approximately $30tn globally. “The ‘investor’ role of the insurance industry is extremely relevant in terms of driving the global
development agenda,” said Mr Bacani. The key risks facing the global insurance and risk management disciplines today include political risk, cyber risk and the risk posed by technological innovation alongside issues such as climate change, natural hazards and access to insurance. “Our goal is for a framework that articulates the role of the insurance industry in sustainable economic, environmental and social development,” said Mr Bacani. This vision of a risk-aware world where the insurance industry better understands the magnitude and complexity of the global risk landscape culminated in the UNEP FI Principles for Sustainable Insurance (PSI). The PSI programme was launched at the UN Conference on Sustainable Development (held in Brazil in June 2012) and is recognised as the largest collaborative initiative between the UN and insurance industry on sustainable development. Mr Bacani observed insurer behaviour since the introduction of PSI confirms a widespread acceptance of its content. “Swiss Re was the first firm to come out publicly with a sustainability risk management framework looking at how its insurance, reinsurance and investment
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