The blows keep on coming for Wells Fargo. Within a year of their cross-selling scandal, two more scandals have risen to the top of news headlines. In part one of this series, I set out to make good on a prediction I presented to business journalist L.A. Winokur. I predicted that after the dust settled…
In a recent interview I had with business journalist L.A. Winokur regarding the Wells Fargo cross-selling scandal, I made a prediction: “Once the dust of this scandal settles, perhaps in two or three years, Wells Fargo will remain vulnerable in other areas of its operations to risk management failures.” Low and behold, the only part…
What Is Domestic Political Risk? Political risk refers to conditions and events that affect organizations and result from governmental decisions. It can have major effects on the profitability/expected value of economic action. Political risks impact individual investors, public and private companies of all sizes, and governments. Starting in 2016, political risk seemed closer to home…
We are often asked for insight on business measures and key performance indicators (KPIs) that can be used to track overall progress and risk management effectiveness. The key question risk managers should ask is: How do I measure the value ERM is delivering to my organization? The following are examples of risk management metrics that will quantify and measure…
Risk Management’s 3 Basic Steps In order to be effective, risk management must involve three phases: Risk identification & assessment Mitigation design & implementation Active monitoring of mitigation activities If an organization misses any of these steps or does not directly link them to one another, it is not fully managing risk. Here’s what…
A big mistake in risk management, especially when it comes to companies with newer programs, is underestimating the importance of standardized risk prioritization. Diving into identification and assessments without a sufficient framework inhibits prioritization. This can result in ineffective risk mitigation and duplicate work across departments, or even serious risks flying under the radar. The possibility…
Regular risk assessments are one of the most important pillars of any risk management department. Although performing business risk assessments is now considered best practice, it’s easy to overestimate their comprehensiveness. As a result, some risk managers are doomed from the start to mediocre results. For a quick check on the adequacy of your risk…
At LogicManager, we are firm believers that embracing risk management can result in two boons: ease of mind and success. On a related note, we recently came across an article by Carl Richards in The New York Times titled “For True Freedom, Learn to Deal with Uncertainty.” “Right now, I’m working really hard on both…
In light of recent events, the Environmental Protection Agency is using new monitoring techniques to evaluate the quality of companies’ classifications and reporting of hazardous materials. Ironically, as we all learned recently, even the EPA itself isn’t immune to catastrophic, if preventable, mistakes. New compliance regulations increase the importance of standardized risk identification, mitigation, and…
Nobody likes surprises in business. Using a risk-based approach to identify your organization’s likely vulnerabilities is highly recommended and vital to short-term and long-term success. Expanding regulations make compliance increasingly complex and expensive, and increases in deficient internal audit controls have heightened scrutiny of companies by the SEC, PCAOB, and investors. Business surprises are preventable,…