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Organizations with a strategic approach to risk management show more confidence in their ability to deal with the multidimensional challenges of the current recession than companies with a more traditional approach, according to the 2009 Excellence in Risk Management survey. The results of the sixth annual Excellence survey—jointly sponsored by Marsh and the Risk and Insurance Management Society (RIMS)—were explored in a recent edition of Marsh's panel discussion series, The New Reality of Risk.
"The more strategically a firm views risk management, the more likely that it has a 360-degree view of risk across the company," said Pam Rogers, of Marsh's Risk Management Optimization Consulting Practice. "Not only are strategic risk managers better equipped to know what is going on elsewhere in the company, they are more likely to feel they can exert some influence."
This year's survey also looked at how the recession affected companies' spending on risk management.
"Although the overall risk management budget did not change significantly at most companies, the recession did change the way that many companies planned to spend their risk management dollars," said Brian Elowe, of Marsh's Global Risk Management group. "All-in-all, the response has been to focus on making the investment in risk management more efficient."
The 2009 Excellence survey backed up last year's finding that enterprise risk management (ERM) may have reached a plateau—at least temporarily.
"The slow but steady increase in the percentage of firms saying they have no plans to adopt ERM is evidence that tough questions about its cost and value are being raised," said Rick Roberts, corporate risk manager at Ensign-Bickford Industries and a board member of the Risk and Insurance Management Society. "Senior executives want to know exactly how ERM adds value. Proponents say that ERM's value to a firm comes in many areas that are not easily quantifiable, making it important for risk managers to effectively point out the qualitative benefits.”
The panel also included discussion with Mark Pollard—head of Marsh's Industry Practices in Europe, Middle East, and Asia—about a new survey of risk management in Europe.
Listen to a replay of the Webcast.
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