risk leadership: a critical adhesive to risk culture
by Katlego Majola Various risk culture models have surfaced over time; these include those from the Institute of Risk Management (IRM) and the Financial Stability Board (FSB), as well as consulting firms. Some models are quite similar and others somewhat different from one another. Power, M, Ashby, S and Palermo, T (2013) compare similarities and variances between the models, which indicates that there is currently no conclusive model for risk culture. Primarily because each model offers a new perspective, hence improvements and adjustments will continue to be made as researchers study the concept further. The concept of risk culture seems simple enough, yet many still struggle to establish measurement and monitoring mechanisms. Risk culture is a breathing and living element within the organizational context, where changes are easily recognizable if baseline information is in place. Organizations have over time collected enormous amounts of data that can be used for this purpose but may not even recognize it as such. A systematic and well-designed approach provides insights, which can be used to construct an overview of attitudes and behaviors that drive risk culture.
This somewhat elusive risk management element is attributed to human attitudes and behaviors, which are not always easy to measure and monitor. It, therefore, becomes critical for those in leadership to have an in-depth understanding of risk culture and their fingers on the pulse at all times. We have in recent days observed how abrupt change can throw even the most stable of organizations into an array of reactive risk management, where changes adversely/positively affect various areas.
Intelligent Risk - February 2021
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