How Airmic will help risk managers future-proof their organisations

The world of risk managers is in a period of rapid change, and the theme of this year’s Airmic conference—“Driving Transformation”—aims to equip them to meet the challenge. From the growth of intangible risks and environmental, social and corporate governance (ESG) concerns to the need to find new, more affordable insurance solutions, the conference on October 5 and 6 will address the hottest topics facing risk managers and offer routes forward.

“The theme is a call for risk professionals to step up, and to have the confidence and the courage to take the risk initiative whenever possible, rather than being reactive in the way we defend against the many headwinds and threats that affect organisations,” says Airmic chief executive officer Julia Graham.

“This theme signals a warning: to seize opportunities to influence, risk professionals must talk the language of business. Nothing leaves business leaders colder than risk jargon—risk professionals must use strategic language, not risk language.”

The risk management bar has been raised during the past 18 months, not least because of COVID-19, Graham says.

“The pandemic was not a ‘black swan’ event. High impact, low probability events are well known, but can be neglected,” she says.

When boards are reluctant to look over the horizon, investing in the management of these risks can require some convincing conversations.

“If leadership conviction was lacking, business continuity and crisis management plans provided the foundations for response, and an ability to respond with agility, adaptability and the smart use of technology has been demonstrated by many,” notes Graham.

“Risk professionals typically have a good grasp of horizon-scanning and the use of scenarios, and these have come to the fore.”

The pandemic has exposed other vulnerabilities, emphasising that in our fast moving, connected and complex technology-fuelled world, the forward-looking skills embodied by risk managers are key.

“It’s increasingly important that risk professionals look forward to anticipate the challenges of tomorrow, how we can influence them now, and to understand what might be contributing to vulnerabilities, so that responses are honed, and vulnerabilities turned into advantage,” she says.

Meeting the COVID challenge

The past year has been a tough one for Airmic’s members. The organisation has supported them throughout, moving its entire programme online within 48 hours of when the crisis first hit. Its Academy of Learning sessions saw an increase in attendance, and it produced an online conference, Airmic Fest, which provided a wealth of digital content to more than 2,000 delegates in September 2020, and to many more thousands who visited the material online over the following months.

The association adapted its existing one-day Technical Forums for climate change, technology and enterprise risk management, and these were well supported by top international speakers. Special interest groups have flourished in a virtual meeting format.

Friday reading materials selected by Airmic, Airmic LIVE webinars on time- and subject-sensitive topics and a COVID-19 resource site were among the pandemic-inspired responses for members.

“In terms of making everything more accessible and inclusive, that’s been big a big plus,” says Graham. “But there remains a hunger for face-to-face events. Now that we are able to host a safe return to physical events with this year’s Annual Conference, we return to providing the core networking and social purpose that we fulfil for our members and our partners.

“I’m looking forward to renewing old relationships and making new connections with our friends and partners in Brighton. Health and safety remains our number one priority and I make no apology that some interventions will be in place—with a balance to ensure we can learn and network and still have some fun.”

Hot topics

One of the topics on the agenda at this year’s conference is ESG. Earlier this year Glenn Ellis took up a newly-created role as Airmic’s ESG ambassador, leading Airmic’s ESG Project Group as well as taking a seat on Airmic’s board.

“We are committed to achieving diversity and inclusion in all that we do, from our thought leadership efforts, to the composition of our board and senior leadership team, to the way we think about our programme, and our relationships with members and partners,” says Graham.

“We are seeing a shift in the way many organisations engage with ESG, going from something that may have been viewed as another compliance exercise, to becoming core to strategy and corporate purpose. In the case of combating climate change, ESG is an essential part of risk management; for diversity and inclusion, ESG is a moral imperative.”

Also on the agenda is the relationship between risk managers and the insurance market.

“The insurance market is at a crossroads,” says Graham. “Concepts and practices embedded in the past are increasingly less fit for the future. I applaud industry efforts to reduce the burden of overheads—but attention to processes at the expense of fundamental change is a risk.

“New models and alternative concepts are emerging at pace, and I’ve been bowled over by the enthusiasm of our insurance partners. But we need more, faster. Our keynote panel in Brighton addresses trends that will change the insurance industry. I’m looking forward to being inspired.”

The increasing use of captives will also be a key conversation, as more organisations explore this route.

“If you overlay the insurance programme over the principal risks of organisations you might say ‘Mind the gap’!” says Graham. “With the change in the mix of intangible and tangible risks—with intangible risks now dominating—coupled with insurance covers at a price and cover many are unwilling to buy, it should be no surprise that where they can, some organisations are turning towards captive insurance where they can exercise more control over cover and price. A risk for the insurance market is that there may be no going back.”

Governance and purpose

With more organisations reexamining or redefining their purpose in the light of recent challenges, Graham sees an opportunity to adopt a confident attitude towards future risks.

“While some definitions and practices for risk management and governance might seem unaffected by the digital revolution, the underlying business and organisational dynamics are so different from the past ones, they trigger the need for a major rewiring of risk management and governance,” she says.

She anticipates that boards will have to reskill and introduce new mechanisms to ensure effective and efficient oversight, strategic leadership and, ultimately, legitimacy for their organisation.

“The idea that companies should have a clear purpose is not new,” she adds. “However, there has been a growing sense among executive teams that they should be able to articulate a shared understanding of why the organisation exists and what the role of the business within larger society should be.

“Organisations must challenge their purpose and, as the pace of change increases, the frequency of reinventing purpose must match the speed of change. Looking longer-term can encourage risk aversion. There is consequently a need to reward confident forward-looking behaviour to ensure commitment to constant business repurposing and evolution.”

Airmic’s future

As a member organisation, Airmic’s top priority going forward is to meet the needs of its members.

“Our partners, affiliated associations, and government remain key stakeholders in the fulfilment of these objectives,” says Graham. “We will seek growth in members and address some alternative stream of revenue. We’ll reveal more once our 2022–2023 business plan has been agreed with our board in December. I’m delighted to say that we have a full and diverse complement of board members to advise and guide me on the journey.

Graham adds that her priority as chief executive is to deliver on Airmic’s promises.

“I have four key team objectives involving financial results, our conference in Brighton, maintenance and growth of the membership and the sustainability and breadth of the industry scope in our partner relationships,” she says.

“I’ll share 2022’s plans with you in December—but I promise it won’t be just ‘more of the same’.”