INTHEBLACK August 2022 - Magazine - Page 46
F E AT U R E
// R I S K M A N A G E M E N T
business process improvements that free up resources
towards high-priority initiatives.
“You can often frame a risk in a negative or a
positive way,” she says. “Your framing should really
be shaped around what your business is hoping to
achieve.
“That might change over time. You’re always
looking for increasing market share and increasing
profits. But there may be sustainability objectives as
well. There may be a desired progression in terms
of using recycled goods or making sure your goods
can be upcycled. Particular priority objectives should
guide the way the business thinks about risk.”
WHAT IS INFLUENCING RISK?
Three specific issues are influencing the changes in
risk patterns and profiles that most businesses are
experiencing today, says Professor Qihe Tang from
the University of New South Wales Business School.
Tang is research director of the University of New
South Wales School of Risk and Actuarial Studies,
46 ITB August 2022
as well as co-director of the recently launched IRIS
Knowledge Hub, which produces forward-looking
and tech-driven approaches to managing traditional
and emerging risks.
“The most fundamental influencer of emerging risk
is climate change,” Tang says. “The second is due to
technology developments and people using advanced
technology that they don’t fully understand. The
third comes from the fact that the whole world is
more interconnected than ever. This interconnection
produces a new source of risk.”
Of course, these influencers of emerging risk are
also areas of massive opportunity. There’s a good
reason, Tang says, that the Society of Actuaries, on
which he often serves as a panel member, popularised
the slogan “Risk is opportunity”.
Without the taking of risk, much of the financial
sector would not exist, Tang says.
“Yet due to new risks, such as climate change
and the pandemic, people want better protection,”
he says. “Companies in the insurance and financial