The Case for a Government Chief Risk Officer (From the Extreme Risk Podcast)

Risk Guide is delighted to bring a very special short episode from the very first series of our Extreme Risk Podcast in collaboration with Runderc.

In this special episode, Alexander Larsen speaks to Mykhailo Rushkovskyi about the need for more Risk Governance at a governmental level in the form of for example a Government Chief Risk Officer which will bring accountability and visibility to how societal and country risk is managed and how risks are considered in decision making. 

The need for resilient countries is becoming more evident by the year and ensuring transition initiatives consider risk is critical to remaining resilient. Over-reliance by the EU on gas from Russia for example has proved a disaster for many countries in the EU. Re-opening of coal mines (despite ESG and environmental targets) indicates how poorly the green transition was thought out in terms of risks and resilience.

And what influence does Leadership play? Alexander highlights an excellent example from Pakistan of strong and positive leadership that can only improve risk culture.

For further information about Mykhailo and his career, you can find the Risk Managers Getting Coffee series on: https://youtube.com/riskguide

You may also find the Extreme Risk Podcast on the most popular platforms:
   ⚪️ Apple podcast
   🟢 Spotify
   🟡 Amazon

Episode Content:

1.00 – Risk Management at Government Level
3.00 – Resilience & Risk-Based Transition Plans
4.20 – The Gold Standard – Pakistan Case Study – Risk Leadership & Culture
7.00 – What is the Role of Risk Management at Government Level
10.00 – Where is Resilience? (Banking, Natural Disasters, Government Budgets)
11.26 – Risk-Based Strategy & Resilience – Norway Case Study – The Norwegian Oil Fund

About the Podcast

The Extreme Risk Podcast is a new podcast that focuses on Crisis and people working under extreme circumstances. The podcast seeks to learn from the few Risk Masters who have experienced extreme events and share it with as many people as possible.

The first series of the podcast are focused on risk management during the largest military conflict in Europe since World War II – the Russia-Ukraine war. Together with Mykhailo, we speak extensively about the lead up to the war, the invasion as well as the months that followed. Undertaking a war risk assessment, preparation for potential scenarios, monitoring, how people reacted and how businesses responded. We also discuss the potential wider ripple effects of the war on the world economy 🌍

For further information about Mykhailo and his career, you can find the Risk Managers Getting Coffee series on: https://youtube.com/c/riskguide and https://riskguide.wordpress.com/2022/02/03/risk-managers-getting-coffee-episode-4-part-1-geopolitics-turmoil-and-a-journey-from-italy-to-ukraine/

All episodes will be released every few weeks here on the Risk Guide website and via our LinkedIn (https://www.linkedin.com/company/risk-guide) and Podcast pages https://extremerisk.buzzsprout.com/ as well as on RUNDERC – https://runderc.com/podcast

Episodes will be released every few weeks here on the Risk Guide website and via our LinkedIn (https://www.linkedin.com/company/risk-guide) and Podcast pages https://extremerisk.buzzsprout.com/

You may also find the Extreme Risk Podcast on the most popular platforms:
   ⚪️ Apple podcast
   🟢 Spotify
   🟡 Amazon

The Russia-Ukraine War series – Episode 4 – The Ripple Effect

The Extreme Risk Podcast – How the Russia-Ukraine war could cause a global ripple effect on countries, societies, individuals and organisations.

Risk Guide is delighted to continue the very first series of our Extreme Risk Podcast in collaboration with Runderc.

In this episode, Alexander Larsen speaks to Mykhailo Rushkovskyi about the potential ripple effects of the war. Looking at what industries are being impacted and what regions could face major risks (from Europe’s energy crisis to an expanding war, through to the Middle East struggling with increased grain and wheat production and potentially facing social unrest). There is an additional focus on resilience with mention to a children’s book focused on resilience called Mr Goose (this can be found at www.mrgooseonline.com

For further information about Mykhailo and his career, you can find the Risk Managers Getting Coffee series on: https://youtube.com/riskguide

You may also find the Extreme Risk Podcast on the most popular platforms:
   ⚪️ Apple podcast
   🟢 Spotify
   🟡 Amazon

Episode Content:

01:00 – What is the Ripple Effect?
02:56 – What scenarios are you considering from a Ukrainian perspective?
05:45 – Reviewing our strategic plans during times of potential uncertainty
07:00 – The various timescales for the end of the war
10:30 – Regions of the world and how they might be impacted by the war
19:20 – The Insurance Role
26:00 – The Risk Appetite
27.45 – Industries Risk and Opportunities from the war
33.20 – Global Economic impact of the war
35:25 – The impact on Society
38:55 – The Individual Responsibility and learning resilience at School
43.00 – Season Wrap Up
44.00 – Long Term Transition and Resilience – The Norwegian Case – Electric Vehicles

About the Podcast

The Extreme Risk Podcast is a new podcast that focuses on Crisis and people working under extreme circumstances. The podcast seeks to learn from the few Risk Masters who have experienced extreme events and share it with as many people as possible.

The first series of the podcast are focused on risk management during the largest military conflict in Europe since World War II – the Russia-Ukraine war. Together with Mykhailo, we speak extensively about the lead up to the war, the invasion as well as the months that followed. Undertaking a war risk assessment, preparation for potential scenarios, monitoring, how people reacted and how businesses responded. We also discuss the potential wider ripple effects of the war on the world economy 🌍

For further information about Mykhailo and his career, you can find the Risk Managers Getting Coffee series on: https://youtube.com/c/riskguide and https://riskguide.wordpress.com/2022/02/03/risk-managers-getting-coffee-episode-4-part-1-geopolitics-turmoil-and-a-journey-from-italy-to-ukraine/

All episodes will be released every few weeks here on the Risk Guide website and via our LinkedIn (https://www.linkedin.com/company/risk-guide) and Podcast pages https://extremerisk.buzzsprout.com/ as well as on RUNDERC – https://runderc.com/podcast

Episodes will be released every few weeks here on the Risk Guide website and via our LinkedIn (https://www.linkedin.com/company/risk-guide) and Podcast pages https://extremerisk.buzzsprout.com/

You may also find the Extreme Risk Podcast on the most popular platforms:
   ⚪️ Apple podcast
   🟢 Spotify
   🟡 Amazon

The Russia-Ukraine War series – Episode 3 – The New Reality

The Extreme Risk Podcast – Adjusting to new opportunities, taking risk, living up to values and mission and developing resilient organisations using risk-based strategies.

Risk Guide is delighted to continue the very first series of our Extreme Risk Podcast in collaboration with Runderc.

In this episode, Alexander Larsen speaks to Mykhailo Rushkovskyi about the new reality of living and working in a state of war. How did people and organisations adapt? what is the importance of being agile and resilient and what opportunities exist in such a reality? Mykhailo uses some great examples of industries that have been created, the importance of values and mission (and living up to them) and the balance between Risk and Reward.

For further information about Mykhailo and his career, you can find the Risk Managers Getting Coffee series on: https://youtube.com/riskguide

You may also find the Extreme Risk Podcast on the most popular platforms:
   ⚪️ Apple podcast
   🟢 Spotify
   🟡 Amazon

Episode Content:

01:45 – How long did Mykhailo expect the war to take?
03:35 – Where did these timelines come from?
06:50 – The importance of considering the other side and culture
09:10 – How do organisations live up to Vision, Mission and Values
13:30 – What is Reputation, and the risks around it?
14:55 – How long has the New Reality existed?
19:50 – A Global Cyber Crisis and Resilience
22:10 – When did people realise there was a new reality? Risk Appetite of the people coming back to Kyiv
23:40 – Risk Appetite – Would you Jump out of an airplane? 
26:39 – Risk and Reward – Quantitative Risk Analysis and Risk Management’s role in decision making
29:30 – Risk Culture, taking risk  and Appetite (the Warren Buffet example)
30:45 – How are people and businesses adapting on the ground?
33:50 – Risk-Based Strategies
35:10 – Types of businesses in the War scenario
37:35 – IT Industry
39:15 – Banking Industry – how did they avoid disruption and stabilise the economy?

About the Podcast

The Extreme Risk Podcast is a new podcast that focuses on Crisis and people working under extreme circumstances. The podcast seeks to learn from the few Risk Masters who have experienced extreme events and share it with as many people as possible.

The first series of the podcast are focused on risk management during the largest military conflict in Europe since World War II – the Russia-Ukraine war. Together with Mykhailo, we speak extensively about the lead up to the war, the invasion as well as the months that followed. Undertaking a war risk assessment, preparation for potential scenarios, monitoring, how people reacted and how businesses responded. We also discuss the potential wider ripple effects of the war on the world economy 🌍

For further information about Mykhailo and his career, you can find the Risk Managers Getting Coffee series on: https://youtube.com/c/riskguide and https://riskguide.wordpress.com/2022/02/03/risk-managers-getting-coffee-episode-4-part-1-geopolitics-turmoil-and-a-journey-from-italy-to-ukraine/

All episodes will be released every few weeks here on the Risk Guide website and via our LinkedIn (https://www.linkedin.com/company/risk-guide) and Podcast pages https://extremerisk.buzzsprout.com/ as well as on RUNDERC – https://runderc.com/podcast

Episodes will be released every few weeks here on the Risk Guide website and via our LinkedIn (https://www.linkedin.com/company/risk-guide) and Podcast pages https://extremerisk.buzzsprout.com/

You may also find the Extreme Risk Podcast on the most popular platforms:
   ⚪️ Apple podcast
   🟢 Spotify
   🟡 Amazon

The Russia-Ukraine War series – Episode 2 – The Invasion

The Extreme Risk Podcast – Evacuation, communication channels, planning routes, recovering business and infrastructure….

Risk Guide is delighted to continue the very first series of our Extreme Risk Podcast in collaboration with Runderc.

In this episode, Alexander Larsen speaks to Mykhailo Rushkovskyi who is based in Kyiv about the invasion itself. Mykhailo shares his experience of evacuating Kyiv, what considerations were needed, what plans he had in place (including routes and petrol stations) and how businesses focused on recovery.

Episode Content:

02:00 – How the invasion started and what were the immediate actions?
04:50 – What are the emotions when something like this happens?
09:04 – What did Mykhailo do when the invasion happened? How did he evacuate?
12:00 – What research and preparation did Mykhailo need in order to prepare?
15:00 – How long did it take to get to safety and to get back to work (and what did that look like?)
22:00 – Mykhailo discusses communications, platforms for communications and rules.
25:00 – How did businesses prepare and what did they expect of staff? What does good plans vs bad plans look like?
31:30 – Importance of Early Warning Signals / Key Risk Indicators in order to focus evacuation
32:38 – Importance of clarity for staff and empowering staff, ensuring they know their roles.
35:15 – What were the key learnings? what would you focus on next time?
39:40 – The importance of testing plans!
41:00 – What did organisations need to focus on from a recovery point of view?

About the Podcast

The Extreme Risk Podcast is a new podcast that focuses on Crisis and people working under extreme circumstances. The podcast seeks to learn from the few Risk Masters who have experienced extreme events and share it with as many people as possible.

The first series of the podcast are focused on risk management during the largest military conflict in Europe since World War II – the Russia-Ukraine war. Together with Mykhailo, we speak extensively about the lead up to the war, the invasion as well as the months that followed. Undertaking a war risk assessment, preparation for potential scenarios, monitoring, how people reacted and how businesses responded. We also discuss the potential wider ripple effects of the war on the world economy 🌍

For further information about Mykhailo and his career, you can find the Risk Managers Getting Coffee series on: https://youtube.com/c/riskguide and https://riskguide.wordpress.com/2022/02/03/risk-managers-getting-coffee-episode-4-part-1-geopolitics-turmoil-and-a-journey-from-italy-to-ukraine/

All episodes will be released every few weeks here on the Risk Guide website and via our LinkedIn (https://www.linkedin.com/company/risk-guide) and Podcast pages https://extremerisk.buzzsprout.com/ as well as on RUNDERC – https://runderc.com/podcast

Episodes will be released every few weeks here on the Risk Guide website and via our LinkedIn (https://www.linkedin.com/company/risk-guide) and Podcast pages https://extremerisk.buzzsprout.com/

You may also find the Extreme Risk Podcast on the most popular platforms:
   ⚪️ Apple podcast
   🟢 Spotify
   🟡 Amazon

The Russia-Ukraine War series – Episode 1 – The Months Leading up to the War

The Extreme Risk Podcast – War Risk Assessment, Business Continuity, Resilience, Key Risk Indicators, Intelligence and Preparation…..

Risk Guide is delighted to present the very first series of our Extreme Risk Podcast in collaboration with Runderc.

The Extreme Risk Podcast is a new podcast that focuses on Crisis and people working under extreme circumstances. The podcast seeks to learn from the few Risk Masters who have experienced extreme events and share it with as many people as possible.

The first series of the podcast are focused on risk management during the largest military conflict in Europe since World War II – the Russia-Ukraine war. Alexander Larsen, together with Mykhailo Rushkovskyi (For more information about his background you can watch his interview on risk managers getting coffee… by clicking here), speak extensively about the lead up to the war, the invasion as well as the months that followed. Undertaking a war risk assessment, preparation for potential scenarios, monitoring, how people reacted and how businesses responded. We also discuss the potential wider ripple effects of the war on the world economy 🌍

All episodes will be released every few weeks here on the Risk Guide website and via our LinkedIn (https://www.linkedin.com/company/risk-guide) and Podcast pages https://extremerisk.buzzsprout.com/ as well as on RUNDERC – https://runderc.com/podcast

Episode 1 is already out and covers the experience of how organisations and people considered their options and various scenarios in order to prepare for the war (War Risk Assessment, Resilience, Business Continuity Plans and Key Risk Indicators)

Episodes will be released every few weeks here on the Risk Guide website and via our LinkedIn (https://www.linkedin.com/company/risk-guide) and Podcast pages https://extremerisk.buzzsprout.com/

Additionally, there are two videos published on Youtube that show the key highlights from the podcast which can be found below:

Russia-Ukraine War – The Months Leading Up To The War – Part 1 – Preparation and War Risk Assessment

Russia-Ukraine War – The Months Leading Up To The War – Part 2 – Key Risk Indicators, Intelligence and Resilience

Mykhailo Rushkovskyi is the Head of Risk Management of the largest Ukrainian private energy holding DTEK, holds MA degree in International Business from Kyiv National University, Ukraine and MBA degree from MIB School of Management, Italy. Mykhailo has over 8 years of experience as a head of risk management function across different sectors such as energy, oil & gas and financial services.

Mykhailo is also a PhD candidate in risk management strategies at Kyiv National University, Ukraine being an author of scientific articles on risk management. An example can be found here: http://baltijapublishing.lv/index.php/gbdej/article/view/1521/1537

The Extreme Risk Podcast

An Introduction to the Podcast

Risk Guide is delighted to present a new podcast in collaboration with Runderc.

The Extreme Risk Podcast is a new podcast that focuses on Crisis and people working under extreme circumstances. The podcast seeks to learn from the few Risk Masters who have experienced extreme events and share it with as many people as possible.

You may also find the Extreme Risk Podcast on the most popular platforms:
⚪️ Apple podcast
🟢 Spotify

From the Russia-Ukraine war to climbing the most dangerous mountains in the world, our guests will share what preparation is needed, what kind of risk assessments and plan B are required and how to constantly monitor any changes in circumstances that could indicate extreme danger

Alexander Larsen, who hosts the show will be meeting guests such as Mykhailo Rushkovkyi who is currently based in Kyiv, and who speaks extensively about the lead up to the war, the invasion as well as the months that followed. Undertaking a war risk assessment, preparation for potential scenarios, monitoring, how people reacted and how businesses responded are just some of the topics covered. He also discusses whats next, what the future holds for both Ukraine as well as the potential wider ripple effects.

Another guest is Marie-Pier Desharnais from Canada, an expert in business continuity and resilience who introduces us to the world of mountain climbing and discusses her experiences reaching the summit of Everest and some of the other most challenging mountains in the world, how she plans, understands risk, remains resilient in the face of danger and manages complacency and stress.

Episodes will be released every few weeks here on the Risk Guide website and via our LinkedIn (https://www.linkedin.com/company/risk-guide) and Podcast pages https://extremerisk.buzzsprout.com/

Risk Managers Getting Coffee: Episode 1

Season 1, Episode 1: Alexander Larsen meets with Gregory Irgin in the UAE to share experiences and insights

In this series of Risk Managers Getting Coffee, we’ll be meeting with seven Risk Managers to gain insight into their risk experiences, areas of expertise and to learn more about risk management in the country they work in.

In this first episode, Alexander Larsen met Gregory Irgin in the UAE. Gregory influences and drives integrated risk management – enterprise risk management, insurance, resilience (business continuity management and crisis security management) – resulting in shareholder protection and return on investment. He has worked across the Middle East and Africa and has exciting stories to share around geopolitical risks.

Introduction: Gregory is Head of Group ERM and Insurance within the aluminium and smelting sector in Dubai and Abu Dhabi, producing and selling aluminium in its 100% form. His customers are all over the world including big companies such as BMW. A mine coming online in Guinea and sales offices are based in America, Europe and China.

Episodes will be released every few weeks here on the Risk Guide website and via our LinkedIn (https://www.linkedin.com/company/risk-guide) and YouTube pages (https://www.youtube.com/c/riskguide).

Episode 1 Overview:

2:36 How did you get into Risk? Gregory originally trained as a lawyer in England, worked in New York until 9/11. Following this he worked in the UK in insurance construction claims and contracts. He has always been an advocate of ethical leadership. Worked all over the world in places such as Jordan, Iraq, Syria and Afghanistan. He discusses headlines v reality, understanding whats really going on in the country and once you know there’s no going back.

3:47 Geopolitics: Africa & Latin America: Working in London, Gregory was travelling to Africa and Latin America. Previously had a trip to Guinea to meet a Government representative and while boarding the plane, received a call saying the person he was due to meet had just been shot. Looking at it now, the stability in Guinea has changed a lot over 10 years.

4:38 People Risk: Nationalisation & Recruitment: Alexander and Gregory discuss bringing on board nationals to be involved and trained early in a project. They want to feel valued, rather than just expats on site. Bringing nationals in early so they are mentored and embedded within the team before expats leave. There will be an issue with Brexit as skilled workers may be leaving.

6:28 What makes a good risk manager, soft skill set vs quantitative and technical knowledge. Gregory is pro soft skills and breadth in risk management. It is essential to step back and review the situation, communication is key. A Risk Manager can draw on technical experts in any industry and don’t need to be quant heavy. They need to analyse information and interpret this to the top level management. Ultimately need a balance around the table to extract the right information from the right people and experts in the company.

9:03 People Bias- How do we engage people? The fundamentals to any organisation are the people. There is a duty of care to lead with ethics, manage people well and drive behaviour. However how can we do that? Each department has own agenda, KPIs arise as tick-boxes and everyone should all be working towards same goals. Alexander had previously worked with a national park senior management team in the UK. Some directors hadn’t ever seen company objectives and some didn’t agree with them. The CEO had just put them together and assumed they would be backed by the rest of the board. How can the whole organisation work together if the CEO and board management aren’t even aligned?

We hope you find this interview useful and informative!

Risk Managers Getting Coffee

Meeting and Sharing experiences (and coffee) with Risk Managers across the world, with Alexander Larsen.

We are proud to announce the first season of “Risk Managers Getting Coffee”. In Season 1 of Risk Managers Getting Coffee, we’ll be meeting with seven Risk Managers to gain insight into their risk experiences, areas of expertise and to learn more about risk management in the country they work in.

At a time where risk and resilience has never been more important, Our guests share risk management expertise, opinions and thoughts on the future.

Trailer- Risk Managers Getting Coffee

Episodes will be released every few weeks here on the Risk Guide website and via our LinkedIn and YouTube pages.

Season 1 Participants:

Gregory Irgin – UAE – Gregory influences and drives integrated risk management – enterprise risk management, insurance, resilience (business continuity management and crisis security management) – resulting in shareholder protection and return on investment. He has worked across the Middle East and Africa and has exciting stories to share around geopolitical risks.

Episode released on 23-Mar-21, found here https://riskguide.wordpress.com/2021/03/23/risk-managers-getting-coffee-episode-1/

Dr Maria Papadaki – UAE – Years of experience in Risk Management from both Academia and Industry, with numerous of years in the implementation, development, improvement and management of risk frameworks, tools and techniques. Involved in Blockchain technology and other innovative technologies.

Peter Smith – UAE – Peter has over 13 years of experience leading teams of advisory professionals and implementing innovative initiatives in Project Controls Solutions and Risk Management across sectors including Oil & Gas, Rail, Infrastructure and Construction in countries like the UK, UAE and Iraq

Horst Simon – Namibia – A veteran in banking operations management, mergers, take-overs and implementation projects; who is now at the forefront of the Future of Risk Management with Risk Management Concepts and Risk Culture Building programs that disrupt and transform organisations to build sustainable competitive advantage.

Mykhailo Rushkovskyi – Ukraine – Has Held several high level risk positions in Energy companies across Ukraine and is a strong advocate for improving risk culture and reporting in his companies.

Aarn Wennekers – Qatar – Extensive international experience supporting Board Chairmen and Directors to promote good governance and enhance oversight of the executive management team to ensure the organization achieves its strategic, operational, reporting, and compliance objectives.

Paul Edge – Portugal – Based in Portugal, Paul is a Risk Manager with years of experience working with Quantitative Risk methods and has been involved in the blockchain space for a while. He has also established a cryptocurrency StatiCoin, a stable coin solution for traders looking for safe investment and merchants looking for a non-volatile digital currency.

We are sure you will enjoy these interviews with these excellent risk professionals!

Pandemic/Covid-19 – Scenarios, Black Swans, and Crisis Communication

By Peter Cockcroft- International Dealmaking Expert

During 2004 and 2005, I was invited to undertake a world tour talking about Risk and Uncertainty (as a Distinguished Lecturer for the Society of Petroleum Engineers). 

Part of my presentation was the utilization of scenarios, made famous by Shell in the 1970s – in order to be prepared for the “high impact/low likelihood” events such as pandemics, terrorist attacks or oil price fluctuations (one of my questions to the audience – “if the oil price drops by 50%, are you are a buyer or a seller?” 

During this tour, I was introduced (in 2005) to the fine work using scenarios (does the pandemic occur tonight, next week, or in ten years?) undertaken by Professor Michael Osterholm (University of Minnesota), which were published in his paper, “Preparing for the next pandemic” (Foreign Affairs, July 2005). He also wrote the 2017 book, Deadliest Enemy: Our War Against Killer Germs. 

He made two, currently pertinent, observations:

A pandemic is coming. It could be caused by H5N1 or by another novel strain. It could happen tonight, next year, or even ten years from now

Can disaster be avoided? The answer is a qualified yes. Although a coming pandemic cannot be avoided, it’s impact can be considerably lessened. It depends on how the leaders of the world – from the heads of the G8 to local officials – decide to respond. They must recognize the economic, security and health threat that the next influenza pandemic poses and act accordingly.

In 2006, the World Economic Forum’s Global Risk Network developed a scenario in 2006 at New York, which illustrated the possible impacts on business, the financial system, and political and economic conditions that could follow from the emergence of a pandemic and explores the role of media “infodemics” in rapidly spreading inaccurate or incomplete information to amplify or downplay the effects of the risk event (often due to political agendas). These so-called “infodemics” are dominating the messaging in today’s world, especially in media talk shows and social media outlets.

Recently (in 2016), Professor Yaneer Bar-Yam continued this dialog on global epidemics in his paper, “Transition to Extinction: Pandemics in a connected world”, followed up by a subsequent presentation specific to Coronavirus (by Joseph Norman, Yaneer Bar-Yam and Nassim Nicholas Taleb), in January, 2020. There is a more recent YouTube interview with Taleb (www.youtube.com/watch?v=e2Kga5HeAqk), which should be required watching for all the risk aficionados.

Taleb, in his book “The Black Swan: The Impact of the Highly Improbable” In 2007 said:

As we travel more on this planet, epidemics will be more acute – we will have a germ population dominated by a few numbers, and the successful killer will spread more effectively.

and,

Once again, I am not saying that we need to stop globalization and prevent travel. We just need to be aware of the side effects, the trade-offs – and few people are. I see the risk of a very strange acute virus spreading throughout the planet.

A Black Swan is a metaphor that describes an event that comes as a surprise, has a major effect, and is often inappropriately rationalized after the fact with the benefit of hindsight. The term is based on an ancient saying that presumed black swans did not exist – a saying that became reinterpreted to teach a different lesson after black swans were discovered in Australia.

The current Covid-19 pandemic is a black swan (high impact/low probability) event, even if we have been periodically hit by unexpected diseases for our whole history. But it has not “blindsided the world” as described by President Trump (9 March, 2020), as this risk has been identified by so many beforehand. 

As we no longer believe that these “black swans” are here as God’s punishment for our sins, the other alternative is that they must have been caused by biological infection – or in some people’s eyes – have spread because of the incompetence of scientists and politicians. 

Now we usually hold the leader responsible not for causing the virus, but for not acting quickly enough to protect us.

 This has led to unpreparedness by most of our leading politicians and world corporate leaders (with potentially deadly ramifications) to properly communicate these risks. 

There have been some outstanding examples of positive messages from some leaders – the New Zealand Prime Minister Jacinda Adern after the Christchurch mosque shooting in May 2019, and Singapore Prime Minister Lee Hsien Loong’s address about the current Covid-19 crisis last month.

Thus the effects of the Covid-19 outbreak it is certainly a candidate for scenario planning, if not conventional quantitative risk analysis. Yesterday (10 March, 2020), we developed scenarios for a large Asian shipping group, using a 2 x 2 matrix, with one axis denoting the spread and effects of Covid-19 – and supply chain disruption on the other axis.

The use of scenarios and proper risk communication to stakeholders are critical to avoiding loss, whether in human lives or in value to corporations and individuals in these difficult to predict events – remember this will not be the last epidemic, nor the last oil price crash. 

The power of Social media in business (Internally and Externally) & how Risk Management can enhance it.

Written by Alexander Larsen, Originally published in Enterprise Risk Magazine (IRM)

There is no doubt that involvement in social media activities is the source of a great number of risks to companies. But there are also risks to not having an online presence. Companies who are not active on social media could surrender ground to competitors, fail to attract a younger customer base, and could end up either not building a reputation – or slowly losing an already strong one.

Organisations cannot avoid social media risk by pursuing a policy of non-participation. Customers, journalists, or the public in general, can easily and quickly point out major faults with a company product or service to a large number of people. With enough attention, that can severely impact brand and reputation. Additionally, tweets can be sent out instantaneously from shareholder meetings, board meetings, or from interviews, leaving little time to prepare for a response. It is vital that organisations manage social media risk proactively.

Companies generally have two main concerns about social media. The first relates to risks to the organisation. For example, an employee that uses social media badly can expose a company to intellectual property and data leakage by saying too much about products and services. Or, extreme views expressed by staff on a company’s social media platforms could be interpreted as a reflection of the company’s own values. Viruses, hacker threat, or phishing attacks can all be introduced into the company network because an employee’s work and private login passwords are identical.

The second relates to the organisation’s social media presence. Where companies are active on social media, for example by having a forum, message board or Facebook page, they are exposed to any customers, members of the public, or disgruntled staff posting negatively about the company, or hijacking company-led social media campaigns. Internally, risks can arise from the inef cient use of social media. Often companies will have a presence on social networks but rarely update them, or have inconsistent
or con icting information, such as contact details, across the various networks. This can frustrate users and lead to missed opportunities.

Understanding social media

Keeping on top of social media-related risks should be straight forward if there is an effective enterprise risk management (ERM) programme in place. With reputation risks being at the top of corporate risk registers and board agendas, there is a need for the constant monitoring of reputation risks (such as social media presence) and mitigation actions should be implemented where needed.

But, as with all risks, you can manage them best when you identify them as early as possible – preferably before you even begin to have a social media presence. The best form of prevention is to be well prepared. When entering into social media, a company needs to focus on the purpose of doing so in the first place. Is it to attract talent, or improve customer engagement, for example? Once this is established, objectives can be set for the initiative. Different objectives will require varying approaches, not only to achieve the desired success, but also in how to mitigate the risks.

One of the mistakes many companies make when developing a social media plan is that it is often left to a single department, such as IT or marketing, rather than to a multi-disciplinary team.

Best practice indicates that representatives from risk, legal, compliance, management and any other affected departments should all be involved with the process. Having such a team in place will allow for proper preparation in terms of understanding the risks of using social media, and how to mitigate them, without having a negative impact on the initial objectives of the plan. Once a robust plan is ready, senior management should be informed, educated and commitment must be obtained.

Mitigating risks

Some companies have a total ban on employee access to social media. Others may decide that only certain sites are appropriate, and could help with the company’s online presence. If a business bans specific social media sites, it should consider the consequences of creating an unhappy workforce. An alternative is to have a completely open social network policy, but with an opt-in programme, whereby staff agree
to “friending” the organisation on their social media sites in return for being able to access it from work.

If employee access is given, there are some common steps companies can take to mitigate social media risk. First, the company should develop a social-media policy and train staff in its use. A social media policy can be short and sweet, or quite long and detailed. A company should consider having one for employee use of social media as well as a corporate social media policy (for those working with social media on behalf of the company). These should include an outline of the do’s and don’ts when posting online, information on the safe use of social media, off-limit subjects or data, as well as the consequences of being in breach of the policy. The legal department should be of use here.

Second, a company should monitor the comments and behaviour of staff on an ongoing basis in order to avoid reputational damage, or even from being held liable for comments made by employees. When using social media sites, there is a risk that staff will upload sensitive data, perhaps by accident, or that they download files which can contain viruses. IT will often restrict downloading or uploading on company computers,
as well as securing sensitive les. Enforcing virus and malware protection is another way that IT tends to protect a company but this needs to be con rmed by the team. This is another reason why having a multidiscipline team that includes IT is so effective.

Finally, dealing with customer complaints in an appropriate manner is vital. Companies should avoid directly deleting comments or negative posts, as well as avoiding aggressive or negative responses. Instead, a company should try to bring the conversation to another platform and try to deal with the complaint directly. Training will be a key element to successful complaints handling on social media.

Force for good

Something that risk managers may overlook with regards to social media is the potential benefits it can bring to risk management. Used in the right way, social media can be a strong tool for managing risks and opportunities, allowing risk managers to tap into an organisation’s most valuable resource – its employees.

Google is a prime example of using social media tools to minimise risk and maximise opportunity.
For example, Google Moderator allows project leaders, R&D teams and top management to post their ideas, initiatives or innovations for

anyone within the organisation to challenge or ask questions about. Voting within the tool allows many of the questions most relevant, or most concerning, to employees to be pushed to the top of the pile.

Not only does the use of such a tool involve the workforce, and thus increase staff morale, but it can drive the success of major change management initiatives (for example after a merger) if everyone feels that their voice is being heard and considered. It can also potentially highlight key risks to a product launch that may not have previously been identified by a project team working on its own. It was so highly thought of that the Obama administration used it when transitioning into office to make the process of change more successful.

A couple of other initiatives that Google has implemented include Google’s weekly all-hands meetings, where employees ask, through social media tools, questions directly to the company’s top leaders and other execs about any number of company issues. Again, this concept can be used by risk managers to capture risks and opportunities from across the organisation.

Perhaps a more obvious risk tool for risk managers would be to implement something similar to the Google Universal Ticketing Systems – GUTS – which allows users to report issues, and is then reviewed for patterns or problems. Adapting this to a more risk-based solution could really support an organisation in identifying risks or trends before they happen. It can allow the reporting of risks from anyone in an organisation, bypassing more senior employees who may try to stop these risks from being reported. Such a tool could serve as a tool to escalate risk past local management.

Continuity

Business continuity can benefit greatly from social media by, for example, connecting stakeholders to internal staff during an incident. Many countries are already using social media, such as Twitter or Facebook, to issue hurricane and tsunami warnings to citizens on top of the more traditional alarms. This not only informs the local population who are in immediate danger, but also allows family members or friends who are signed up to the service to receive these notifications.

A similar approach should be considered by companies when it comes to spouse management during a major incident. Companies who operate in dangerous locations such as war zones, politically unstable regions, or on offshore oil platforms, should consider offering employees’ spouses the opportunity to connect to a specific company emergency social media page. This page can be the main hub of communication for spouses should an emergency occur. Not only will they get regular and factual updates, but they can post questions and even comfort each other by having a community of people in similar situations as themselves. This could be extended to include sites for connecting with stakeholders during an incident whether it be suppliers, clients or even the media.

Social media has already been used successfully during earthquakes in Japan. Pages were set up on Facebook to keep the public up to date, whilst Microsoft worked with partners to create local applications such as J!ResQ – a smart phone application for emergency contacts– to help people and family and friends and to aid relief efforts with aid agencies. Looking more internally, business continuity plans will have steps that include informing staff of job status, whether to stay at home, work from home, work from an agreed second location, or even return to work. Using an internal social media tool can greatly improve the efficiency of this message compared to more traditional methods such as a phone call to every staff member.

Getting over initial worries about the use of social media can turn many of the risks associated with these technologies into opportunities. By carefully working through the threats and mitigating risk, risk managers can help their businesses benefit from these powerful tools.