Strategic risk for directors

Citation

(2006), "Strategic risk for directors", Structural Survey, Vol. 24 No. 4. https://doi.org/10.1108/ss.2006.11024dab.014

Strategic risk for directors

Industry leaders today launched a ground-breaking report Strategic Risk – a Guide for Directors (STRATrisk), produced by professional bodies, and the actuarial profession, with research by the University of Bath and support from the DTI. The new report and guidelines, aimed at directors of companies and public sector bodies, set out, for the first time, the various steps which companies should take in order to manage strategic risks effectively. It stresses the need for “risk leadership” within an organisation to establish the right culture and internal communications system. Strategic risks include loss of reputation, fraud, staffing, customer dissatisfaction, over-complexity and financial mismanagement. Some strategic risks are foreseeable but others are less so, but they can still be managed and this guide shows how.

Mike Nichols, Chairman of the STRATrisk group and Chief Executive and Chairman of the Nichols Group, said: “There is simply too great a waste of resources because at present, there is a failure to properly assess risk. Far too many companies fail unnecessarily and we hear much too often of serious problems in the public sector. As a result, customers are disadvantaged, employees are at risk of losing their jobs and vast sums of money are lost. Most of those in charge of enterprises need to get their act together and pay more attention to the key risks.”