As the flip side of any opportunity, the risk is an inherent part of any business. While conventional wisdom focuses on the risk capabilities of organizations, in practice, it depends on the risk intelligence of every employee. Risk intelligence is the intuitive perception of risk that is critical in driving actionable insights concerning business decisions, corporate governance, threat mitigation, and compliance. It is a holistic approach that seeks to align risk management with organizational strategy in pursuing business goals, and a coordinated and integrated approach towards risk management, in an effort to balance risks with opportunities.

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At an individual level, it leverages the understanding of risk, its likelihood, and its impact on every decision that one takes whether personal or professional. Fundamentally, it equips people to think from a risk perspective or with a risk lens in everything that they choose to do – procurement, sales, marketing, legal, accountancy, supply chain, sustainability, human resources, and more.

Developing risk intelligence

Risk intelligence can be learned through in-depth knowledge of Enterprise Risk Management (ERM) through practical experience, on-the-job training, and education. ERM is the process of identification and mitigation of risks across the enterprise in the pursuit of strategic objectives. An ERM qualification, thus, equips you to identify emerging uncertainties, analyze the various possible outcomes and convert these into opportunities.

An ERM qualification is also increasingly being seen as key in developing risk intelligence, irrespective of the sector or department in which one works. Traditionally, risk management has been largely confined to the finance, banking, and insurance sectors. However, the volatile economic climate and series of external shocks over the years, have significantly increased risk exposure for businesses. The emergence of new uncertainties from risks such as: cybersecurity, climate change, reputation, and supply chain, has further increased the need for risk-intelligent professionals across sectors.

A 2021 survey on the top ten risks in the Asia Pacific region revealed the emergence of new risks such as business interruption, cyberattacks, economic slowdown, reputation risk, and health crises. The survey also revealed that despite a growing level of readiness among companies, the volatile and changing nature of the risks confronting businesses today has resulted in the highest-ever loss of income.

Given this volatility in the global economic environment and a looming demand for qualified professionals, ERM as a career has become one of the highest-paying jobs in India. With a proactive approach, ERM seeks to develop your ability to spot these risks and have them on the organization’s radar before a crisis strikes or indeed allow time for the organization to be nimble enough to capitalize on an opportunity.. Risk intelligence, then, dictates our ability to evaluate threats in terms of their impact, thus, triggering appropriate mitigation strategies.

Qualities of a risk-intelligent professional

A risk-intelligent professional can think from a risk perspective with an analytical and problem-solving approach empowering them to make decisions that are based on careful evaluation of all factors - to find the most appropriate balance between risk and opportunity.

By encouraging risk-based decision-making, risk-intelligent professionals also help in augmenting the overall organizational risk culture. In the long run, they can help in reducing the impact of any crisis while enabling the company to pursue its goals, thereby increasing the lifespan of the organization. Consequently, risk-intelligent professionals command a higher salary than their peers who only have domain expertise.

Need for risk intelligence

With the growing focus on risk management, it is not surprising to note the growth in its market size, which is projected to go up to $ 28.87 billion by 2027 from $ 7.39 billion in 2019, growing at a CAGR of 18.7 percent in this period. This makes it an ideal time to work in risk management services as well, such as risk consulting, risk-based research, due diligence, risk analytics, or credit risk analysis.

ERM qualifications can also help you to gain a foothold as a risk-intelligent business leader in fast-moving careers across functions such as cybersecurity, supply chain, marketing, and human resources. The salary for risk-intelligent officers in such roles can range from Rs 9 lakhs to Rs 45 lakhs per annum. One can eventually reach a C-suite position as a Chief Risk Officer with salaries ranging from Rs 75 lakhs to Rs 3 crores. Those who are interested in striking out on their own can also set up a risk-tech business.

Today, everyone is a risk manager and risk-intelligent individuals have the potential to help organizations across sectors travel through uncharted waters.

How can you become risk intelligent?

One can develop their risk intelligence by pursuing the Institute of Risk Management’s (IRM) globally recognized ERM qualifications and examinations. IRM is the world’s leading risk management professional body, with members/students across 140+ countries. You can pursue these globally recognized qualifications with IRM India Affiliate by appearing for the professional exams that confer professional designations at each stage after Level 2, all the way up to a Certified Fellowship in ERM at Level 5. With international recognition, a global community of ERM professionals, and a sector-wide application. The IRM’s ERM qualifications can help you to secure a position in any industry of your choice as a certified ERM professional.

Interested candidates can apply for the Level 1 examination while studying for their graduation/post-graduation degrees or while working. Professionals with 2-3 years of experience in risk management can apply directly to Level 2.

The future success of businesses depends on the organization hiring/developing risk-intelligent officers who can plan and implement risk management policies. With the growing recognition of the importance of having a solid risk management function and staff, it is clear that developing risk intelligence through an ERM qualification can help you and your organization in creating value and, on a personal level, provide you with a chance to supercharge your career with immense growth potential. IRM’s qualifications equip you with the professional skills, tools, and techniques crucial to businesses.

Start your journey here.

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First Published:Feb 23, 2022 6:46 PM IST