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Risk management is crucial for companies

Risk management is crucial for companies
Source: Revista Risco29.09.2017
Risk management has been increasing in strategic importance for companies and organisations that recognise it as a key element of successful management in our deeply complex and unstable world.

"In order for there to be no surprises, it is necessary to analyse the risks in companies” said Jorge Luzzi, chairman of Herco Global, in an interview with Risco magazine.

In this context, Jorge highlighted the crucial role of the risk manager: "The risk management profession is difficult; it requires having an analytical perspective, because when developing a risk prevention plan, we must think of risks that have not yet happened, but which may do so in the future.”

It is the risk manager who must analyse the company’s current situation, consider potential future situations, try to transfer all possible risks to the insurer and where this isn’t possible, develop a strategy to reduce the risks’ impact.

A role that Jorge says does not require the work of genius, but rather a coordinated effort by everyone in the company, beginning with the chairman. "In a company, the person responsible for risk management must follow the principles of Enterprise Risk Management (ERM) and be pro active and risk-oriented. There must also, however, be a wider risk committee, where all company areas come together to identify and talk about the risks”, he argues. "This prevents situations occurring that stop a business from carrying out its activity.

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