The report is a collaboration between Mazars, the international accounting and advisory firm, and risk technology research firm Chartis Research. It highlights how the CRO is the key link that can enable companies to embrace insight-driven risk-based solutions, and prove that enterprise risk management (ERM) is critical to enable insurers to maximise their future opportunities.
“Future CROs will need a wider, more strategic set of skills to fulfil the leadership role that is required,” says Michael Tripp, Head of Financial Services and Partner at Mazars.
Gez Llanaj, Head of Risk & Capital in Mazars’ Financial Services team, adds: “’Doing ‘your best’ in risk management is not good enough anymore. Many insurance companies have little or no strategic risk protocols in place, and the research findings in this report clearly indicate that for insurance companies to survive, they will need to embrace integrated strategic, financial, operational and IT transformational programmes.
These are most likely to be directed through strong CRO leadership, with additional guidance from the Chief Investment Officer.
“A strong Solvency II ratio is not a guarantor of a successful insurance company. Insurers will need strong risk leadership, risk ownership, and an enterprise risk framework, all working in harmony to embed and execute risk decisions at all levels – and these will ultimately be the responsibility of, and delivered through, a properly empowered CRO.
“The most recent WannaCry cyber-attack is yet more evidence of the increasingly complex world of risks, and highlights why a modernised ERM framework driven by strong CROs is essential to preserve value for all firms.”
According to Sidhartha Dash, a research director with Chartis Research, “Technology is increasingly important here, and we’re seeing risk management technology in insurance evolving. CROs can now sit in a ‘strategic layer’ in the firm,
using a range of technology tools to achieve the right risk management approach for their organizations.”
As insurers open themselves up to greater risk in search of returns, the need for a reliable and real-time consolidated view of risk within firms becomes critical to create value. It is estimated that only 48% of insurance firms have have an actual CRO in the C-suite, and it is our belief that only 20% of CROs are empowered to drive their companies into the new stage of business-model transformation required for future growth and competitive advantage.
The full report is available here
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