What to expect from the IRMSA 2021 Risk Report

Since 2014, the Institute of Risk Management South Africa (IRMSA) has released an annual report focusing specifically on South Africa’s risk landscape.

Soon to appear in its seventh edition, this report is already widely recognised as the definitive view on South Africa’s different risks, how they impact its people and industries, and what we could prepare for.

Yet the 2021 report comes at a very crucial time, arriving amidst the confusion and challenges caused by the COVID-19 pandemic. The pandemic has boosted topics such as risk management, existential threats and resilience higher on the agenda. This will, no doubt, make for some interesting reading.

To get a better view of what to expect from the 2021 edition – due for release in late February – Sean Pyott, Managing Director at thryve chatted to Christopher Palm, Chief Risk Advisor at IRMSA and one of the report’s co-founders.

Which edition of the report will this be, and is there anything special about it?

CP: The IRMSA Risk Report 2021 will be the seventh edition, and this is going to be the most significant report that we have launched. I think it goes without saying that COVID has a lot to do with it, and I think our report will now get a lot more traction. And not just because of COVID, but because the report is also recognised internationally as a definitive examination of South African risks.

The nature of risk conversations shifted during 2020. You would like risk to be used more broadly and not just focused on negative consequences. Could you elaborate?

CP: When we use the word risk, by implication, it includes opportunity. But because the masses don’t see it as that, we talk about risk and opportunity regularly. Risk management is for everybody. It’s not just for the chosen few. So I think it’s just important to say that the report this year recognises that we can’t just do less of the bad. We must also do more of the good. That is something the 2021 edition will focus on. For example, we have a section in the report that talks about the call to action. What is this call to action? How are we going to change the path that we are on?

Risk management is still treated as a grudge purchase by many companies. Yet it can be a powerful strategic tool. Why isn’t this message growing faster across South Africa?

CP: The most important part of risk management is knowing your objectives. And then the second part is understanding your context. When I started off in risk management, it was a grudge purchase similar to your car’s short-term insurance. You don’t want to pay for it, but you need it, and therefore you do it, and you don’t smile when you buy it. Risk management is still pretty much like that for many organisations.

One of the reasons for that is because we in South Africa haven’t yet matured risk management to the extent that we can show value. We don’t show that risk management can contribute to whatever your desires are. Desires may not be a good business term, but I don’t want to just say ‘return on investment’, or your share price. It’s about what is it you can leverage that is good for you? So whether that be a positive, maybe a positive environmental label, or whether it’s good health and safety numbers – we haven’t demonstrated enough that risk management can contribute to that.