The Association of Chartered Certified Accountants (ACCA), The Association of Insurance and Risk Managers (Airmic), and the Professional Risk Managers’ International Association (PRMIA) collaborated on a study to gauge how risk and financial leaders are dealing with risk culture and to what extent they understand its effect on the organisation’s broader strategy.
The research is based on an online global survey complemented by a mix of interactive engagements with the three professional bodies’ respective members, gathering views from thousands of risk and financial professionals around the world. The findings are published in a new report, Risk Culture: Building Resilience and Seizing Opportunities.
The report found that while ‘box ticking’ is prevalent, there is growing interest in risk culture to cope with disconnected organisational cultures and hard-to-detect breadth of risks. Key risk priorities for risk and finance professionals across all regions were ‘regulatory, compliance and risk’ followed by ‘technology, data, cybersecurity’ and ‘economic inflation and recession’.
Sector-specific results showed respondents in financial services were more likely to raise ‘technology, data and cybersecurity’ and ‘regulatory, compliance and legal’ as their two highest risk priorities, whereas those in the corporate sector ranked ‘logistics and supply chain’ issues as one of their top three risk concerns.
The report also revealed that risk conversations continue to happen in a vacuum at the top of organisations, and that engagement not only between boards and senior management – but also across functions and roles – needs significant improving. Recent corporate collapses have highlighted how inadequate and siloed risk governance can be, regardless of what is said in their financial statements.
The report incorporates insights from over 2,000 risk and financial professionals around the world. The online survey took place in October 2022 and attracted 1,823 individual responses from risk and financial professionals globally, across a range of industries. Additional forums, roundtables and one-on-one interviews with more ACCA members contributed further qualitative data.
To complement the findings, the report also includes ten calls to action, such as empowering risk leaders to drive risk culture and influence behaviours, understanding the behaviours driving both good and bad outcomes, and defining risk appetite clearly and communicating its purpose to help guide behaviour and inform better decision making.
The report concludes that managing risk dynamically and building resilience collaboratively are changing risk culture for the better. ACCA will publish additional research on risk culture by industry throughout 2023.
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