Effective Risk Leadership

How good is learning? Another Friday, another AICD Climate Governance learning session - this time Strategy and Leadership. I loved the headline quote in this week's session:

▶▶ "When leaders are doing their best, they Model the Way, Inspire a Shared Vision, Challenge the Process, Enable Others to Act, and Encourage the Heart." (Kouzes and Posner). ◀ ◀

But this is not a post about climate governance because my mind is deeply riding the CPS230 wave 🌊 this week as the APRA Guidance was (happily) finalised this week. It made me think of the role of the Board and Exec in driving the change they want to see in their organisations. So I have broken down the quote and tried to highlight ways leaders can build operational resilience tone from the top!

Model the Way

↪ Leaders can set the standard for operational risk management by demonstrating commitment and integrity. They can ensure that governance arrangements for overseeing operational risks are robust and clear, establishing a culture of accountability and excellence​​.

Inspire a Shared Vision

↪ By communicating a clear, compelling vision for risk management, leaders can foster a unified approach to resilience. This vision should include maintaining critical operations within tolerance levels through severe disruptions and managing the risks associated with service providers​​.

Challenge the Process

↪ Leaders should encourage continuous improvement by challenging existing processes and seeking innovative solutions. They should oversee the effectiveness of key internal controls, ensuring that operational risks are identified, assessed, and managed proactively​​.

Enable Others to Act

↪ Empowering teams is essential for effective risk management. Leaders can provide the tools, resources, and support needed for teams to implement and maintain comprehensive risk management frameworks, including business continuity plans and scenario analysis​​.

Encourage the Heart

↪ Recognising and celebrating successes in risk management can foster a positive and resilient organisational culture. Leaders who acknowledge the efforts of their teams can inspire continued commitment and dedication to operational excellence​​.

Leadership is key here, as always.

August Advisory