Financial Services

Executive Overview of our Risk Culture Maturity Monitor and the benefits of using this tool to support your ERM Implementation process and drive sustainable competitive advantage through an effective Enterprise Risk Management Culture

Background

Organisations are at different levels of maturity and various stages of implementation of Enterprise Risk Management. The global operating environment is at an ever increasing pace of change and with this the exposure to risks grow on a daily basis so that many organisations find themselves at a loss to identify and understand what is the next step in the process of implementing an effective Enterprise Risk Management Culture.

Many organisations call in costly external consultants at this point and trust that they would be able to understand the business and find a solution in the shortest time possible; this is no longer needed.

We bring experience to bear on your issues; in a practical, ‘light touch’ manner that delivers results. We help you to define the goals and support you to achieve them internally, ensuring a robust and long-living working solution.

Risk Culture Maturity Monitor is an effective software tool that accurately measures the level of maturity of the implementation process of embedding an effective Enterprise Risk Management Culture in any organisation.

This tool was developed as a result of more than 10 years of intensive research on the subject of Risk Mitigation and how to address the people risk component of Enterprise Risk Management. Most organisations build impressive risk management systems, but fail to address the fundamental issue of Risk Culture.

The Risk Culture Maturity Monitor

The Risk Culture Maturity Monitor provides information on the level of maturity of the implementation of Enterprise Risk Management in six key categories within business operations:

Key categories are:

  1. Policies
  2. Processes
  3. People and Organisational Design
  4. Reporting
  5. Management and Control
  6. Systems and Data

The system is delivered through our unique Genius Methods online platform therefore no infrastructure investment is required.   Users are only required to have access to the Internet and each will be supplied with a unique User ID and Password to complete their assessment online.

The first step is a once-off assessment to evaluate risk maturity levels at a given point in time. This evaluation will objectively identify specific gaps and support requirements to form an action plan based on concrete evidence, not perception.

The underlying mathematical model is not visible to users and all questions are structured in a multiple choice style in such a way that it is impossible for any user to manipulate or predict the outcome.

Organisations that take a longer term view and carry out bi-annual or annual assessments will get the most value as they will be able to effectively track progress (and regress) of their Risk Maturity.

Outcomes based reporting: The reporting from the system will provide an accurate picture of the level of progress maturity in each of the 6 categories. There are 5 levels of Risk Maturity defined in the system. These are:

Urgent review required, no progress and possibly no strategy Level 1
Some progress made to establish an ERM Culture, focus and drive ERM Strategy Level 2
Below ERM Culture  Maturity Average, review implementation process Level 3
Reasonable Level of ERM Culture established, review outcomes and reporting Level 4
Mature ERM Culture, focus on continuous improvement and value add Level 5

 

The value of this report not only lies in having an accurate assessment of each maturity level (above), but organisations will also be able to identify the key areas to address and focus on in the process to achieve the top level of maturity in each of the 6 categories (see earlier) .

How can this system be used by your organisation to effectively track the levels of maturity of an ERM Culture in all departments/subsidiary companies?

There are three different commercial options that will all add value to the procedures carried out by your organisation in the process of effective supervision of Risk Management Implementation.

In each case:

  1. A list of departments / subsidiary companies must be submitted to Genius Methods.
  2. Outcomes based reporting will be available only to yourselves as
    1. a consolidated report, and
    2. An individual report per department / subsidiary company.
  3. Feedback reports will be based on data submitted directly by the organisation which will therefore be without any intervention or subjectivity added by any third party

Option 1

All subsidiary companies carry out a once-off assessment.

  • Genius Methods will provide ONE User ID and Password for each user to complete the assessment online.
  • This option will give your organisation an accurate picture of the level of maturity of ERM in each subsidiary company.

Option 2

All departments of each subsidiary company carry out a once-off assessment for each area of operation / division.

  • For this option Genius Methods will provide ONE User ID and Password for each defined department of each subsidiary (entity) to complete the assessment online.
  • This option will give you an accurate picture of the level of maturity of ERM in the different departments in each entity.
  • Your organisation will thus be able to identify and to focus Risk Control efforts and risk management guidance.
  • This option will further enable your organisation to evaluate all relevant entities against a set benchmark to be determined by your organisation.
  • It will further enable you to benchmark the maturity level for the whole organisation in each of the 6 categories.

Option 3

To complement either Option 1 or 2 you can take a long term view and use this process to effectively support all entities within your organisation with the implementation of an effective ERM Culture by carrying out either of the options described above on a bi-annual or annual basis over a period of 5 to 10 years.

  • This option will give you an accurate picture of trend over the selected period
  • The trend analysis will provide accurate information to evaluate progress made by all departments/ subsidiary companies.
  • The consolidated report will reflect the trend and status of maturity for the entire organisation.

Conclusion

The value of this system lies in the fact that all assessments are done online by the users within the various entities or departments  and you will receive the outcomes reporting based on this data.

The value of this system lies in the fact that all assessments are done on-line by your own staff and you will receive the outcomes reporting based on this data.

There can be no arguments or questioning of the reports as they are based on assessments done by your staff, not by any head-office function or outsider.

This will strengthen the supervisory role of your central risk control function through accurate supporting documents for each area within the organisation.

Apart from the value of having a focused ERM Strategy with action plans supported by these reports, the consolidated reporting in any of the options will reflect the status of the whole organisation and will be valuable in discussions with Financial Institutions to support funding applications and Insurance Providers to obtain optimal pricing for risk transfer through insurance.

Please see the attached presentation (RCMM Brochure) for examples of reporting.