The Institute of Risk Management
Résumé: For over 25 years the Institute of Risk Management has provided leadership and guidance to the emerging risk management profession with a unique combination of academic excellence and practical relevance. The Institute’s profile continues to grow internationally with heightened interest in the management of risk across government, public and business domains.
This board guidance on risk culture is our latest contribution to thought leadership in the field. The continuing parade of organisational catastrophes (and indeed some notable successes) demonstrates that frameworks, processes and standards for risk management, although essential, are not sufficient to ensure that organisations reliably manage their risks and meet their strategic objectives. What is missing is the behavioural element: why do individuals, groups and organisations behave the way they do, and how does this affect all aspects of the management of risk?
Problems with risk culture are often blamed for organisational difficulties but, until now, there was very little practical advice around on what to do about it. This paper seeks to give guidance in this area, drawing upon the wealth of practical experience and expert knowledge across the Institute. It aims to provide advice to organisations wanting greater understanding of their own risk cultures and to give them some practical tools that they can then use to drive change. It should be of interest to board members, executive and non-executive, risk professionals, HR professionals, regulators and academics.
This short document summarises our approach to risk culture for those working at board level. There is also a longer companion document – Risk Culture: Resources for Practitioners – which covers the detailed thinking behind the concepts and models that we have found to be useful. This remains a developing area and we do not consider that we have written the last word on the subject – we expect to see more models and tools and in particular sector and issue-specific work emerging in the future.
