This last prediction is also a strong hope I have for risk management in 2018. The sheer volume of corporate scandals topping news headlines should be enough of a wake-up call to Boards, CEOs, and senior management alike in every industry to take risk management seriously.
United lost $1 billion in market value the day after Dr. Dao was dragged from the plane, Chipotle’s stock prices have yet to recover from the E. coli outbreaks of 2015, and Uber is struggling to keep customers on their side of the fence.
Equifax is a particularly poignant example, as their massive data breach not only reflected poorly on them, but on every single company who gave away their customers’ information to the credit bureau in the first place.
Consumers are outraged, fed up, and will move their money elsewhere to companies who can prove their trustworthiness in regard to protecting their data and their best interests.
If corporations want to be counted among those whom customers, investors, and employees believe in, then they’ll need to seek out and implement strong ERM processes and systems that are capable of breaking down silos, assessing risk objectively, prioritizing resource allocation, and monitoring the effectiveness of controls.
I believe 2018 is going to be another big year for ERM, one of heightened awareness, increased implementation, and, hopefully, less scandal.