Most companies recognise Enterprise Risk Management (ERM) as a necessary investment - usually as a once-off payment for a basic ERM road map and some initial consulting. Once an ERM plan is in place and signed off companies believe they have ‘ticked the box’ and that they are fully compliant.
But, argues Oliver Laloux, Business Unit Leader, Strategic Risk Consulting, a division of, Alexander Forbes Risk Services, “If ERM is to benefit a business it needs to become part of daily practice”.
You can’t just make ERM the responsibility of the company secretary, internal auditor, risk manager or compliance officer. ERM it is an organisation wide practice. The whole organisation needs to be trained, monitored and updated on an ongoing basis until ERM becomes part of the company culture.”
As such, ERM should be seen as an ongoing commitment to a process - involving a serious investment in people training.
Laloux continues that, “Given the centrality of capacity building and training in ERM it is surprising how few sources of ERM training there are in South Africa – and, in consequence, how serious the shortage of professional risk managers actually is.”
Until 4 or 5 years ago, risk management was not seen as a professional discipline, merely an element of risk control, or something to be bolted onto health, environmental and safety management. Since the growth of the concept and practice of ERM, however, along with the King Commission’s inclusion of ERM as integral to good corporate governance, risk managers are now in demand.
Unfortunately adds Laloux, “Courses in enterprise risk management and business continuity planning are not offered at South African tertiary institutions in either the number or form required by the country and the continent. Traditionally these skills were developed in-house in a few of the larger risk companies - and since there are so few large risk companies in
Alexander Forbes has always had a strong business case for developing ERM skills. As such it has sufficient ERM practitioners in-house to meet clients ERM needs on a consultancy basis. When consulting contracts finish, however, companies are generally not in a position to carry on managing their ERM as critical knowledge and management skills are seldom internalised during the period of a standard consulting contract. Recognising this, Alexander Forbes has developed ERM training and capacity building programmes. Each module rolls out specific enterprise risk management components in tandem with client specific capacity building plans. Laloux explains that, “This helps organisations understand and set up their ERM in house, while the capacity building exercises enable clients to apply their ERM needs within their own businesses - using their own people.” “The practical capacity building exercises that turn temporary training into permanent organisational practice is the critical factor”, adds Laloux. Laloux observes that, “The ERM skills shortage is more serious in the public sector which lacks the funds to bring in expensive external consultants. Similarly, medium sized and smaller players in the private sector also face these problems.” Despite Alexander Forbes pioneering ERM training and capacity building processes Laloux knows that, “By ourselves we cannot train the full number required by the public and private sector in
Instead, concludes Laloux, “A broader recognition of the need for ERM skills and capacity is needed amongst all interested parties – the private sector, risk service providers, trainers, secondary and tertiary institutions and the state. And finally someone must fund it.” “Until an all inclusive state-funded programme to develop these skills is put in place our economy looks set to remain short of these critical skills for some time to come.” Instead, concludes Laloux, “A broader recognition of the need for ERM skills and capacity is needed amongst all interested parties – the private sector, risk service providers, trainers, secondary and tertiary institutions and the state. And finally someone must fund it.” “Until an all inclusive state-funded programme to develop these skills is put in place our economy looks set to remain short of these critical skills for some time to come.”
Alexander Forbes has always had a strong business case for developing ERM skills. As such it has sufficient ERM practitioners in-house to meet clients ERM needs on a consultancy basis.
When consulting contracts finish, however, companies are generally not in a position to carry on managing their ERM as critical knowledge and management skills are seldom internalised during the period of a standard consulting contract.
Recognising this, Alexander Forbes has developed ERM training and capacity building programmes. Each module rolls out specific enterprise risk management components in tandem with client specific capacity building plans.
Laloux explains that, “This helps organisations understand and set up their ERM in house, while the capacity building exercises enable clients to apply their ERM needs within their own businesses - using their own people.”
“The practical capacity building exercises that turn temporary training into permanent organisational practice is the critical factor”, adds Laloux.
Laloux observes that, “The ERM skills shortage is more serious in the public sector which lacks the funds to bring in expensive external consultants. Similarly, medium sized and smaller players in the private sector also face these problems.”
Despite Alexander Forbes pioneering ERM training and capacity building processes Laloux knows that, “By ourselves we cannot train the full number required by the public and private sector in
Instead, concludes Laloux, “A broader recognition of the need for ERM skills and capacity is needed amongst all interested parties – the private sector, risk service providers, trainers, secondary and tertiary institutions and the state. And finally someone must fund it.” “Until an all inclusive state-funded programme to develop these skills is put in place our economy looks set to remain short of these critical skills for some time to come.”
Instead, concludes Laloux, “A broader recognition of the need for ERM skills and capacity is needed amongst all interested parties – the private sector, risk service providers, trainers, secondary and tertiary institutions and the state. And finally someone must fund it.”
“Until an all inclusive state-funded programme to develop these skills is put in place our economy looks set to remain short of these critical skills for some time to come.”
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