Strategic Risk Leaders Conference - Risk Management FAQ's

What would the practical applications be from reconstructing governance frameworks to breakdown silos and close gaps in risk oversight? 

The very common issue witness in the risk management framework is that the company risk activity is taking place in silos. Usually, it is taken as a task rather than an integrated and ingrain activity of the organization. The risk oversight gaps can be bridged by convincing the Board to enforce the risk management part of the entire organization activity and making management accountable for not integrating the risk activity in all the functions. The risk manager also needs to play a pivotal role to spread awareness of risk management activity within each process, being the solution to the problem rather than being part of the problem. The second and third line of defense shall be working closely to enhance the risk awareness towards the first line of defense.

What are the current top 5 challenges faced by risk managers and VPs today in the middle east?

In today’s time, the impact of the risks does not confine by borders, but rather have an impact across the board. I believe the Middle East is no different and are prone to some global risks such as geopolitical and economic confrontation has a direct impact on oil prices and regional trade. Paradoxically, climate change is more likely to impact the ME region as well. This year Kuwait and some parts of Saudi Arabia reported the hottest temperature 60 C in the world by breaking the earlier US record. Climate change will have a direct impact on the ME countries tourism.

A recent report by PWC has found that businesses in the Middle East are more prone to cyber-attack than those anywhere else in the world also suffered larger loss from cyber-attack then the world’s other regions. More than a million phish attacks were recorded in the UAE during the first quarter of 2019.

The Middle East real estate prices have fallen since 2014. A downturn trend of real estate increases the risk of deflation, which the central banks have limited ability to combat given their adherence to exchange rate pegs. Exchange rates difference also make difficult for prospective buyers. The estate weakness putting a strain on real estate loan (20% of the UAE and Qatar total credit) combined with the adoption of IFRS 9 accounting standard and increasing non-performing loans.

How can risk heads today create better communication between CEO, CFO and CRO?

Initially, there must be a tone from the top (Board) to enhance the risk governance framework within the organization. The CRO can help the other Chiefs not only limited to CEO or CFO, to ensure they see the value of risk activity and how that activity not only lead to treating the risk but rather enhance the value contribution by making an effective and well-informed the business decision towards the combined goal of achieving the business objectives.

What are your views on the implementation of the new international ISO 31000 risk management standard?

The new changes make the understanding and application of the risk management framework easier than before. It also necessitates the need for the integration of risk management within the fabric of the organization by focusing the key risk management principles. Lastly, the greater focus on the open system model to exchange feedback with an increased emphasis on the iterative nature of risk management.

Why is it important to turn around problem clients and resolve the problems instead?

Focusing on the solution of the problem make the problem resolution easy. The shift to resolves problem will turn around the problem clients into opportunity clients by harvesting the benefit of problem-solving through effective risk management approach. Once the client sees the benefit, there is no way they do not regard risk management value within the organization.

P.S. I will be keynote speakers of the panel discussion "Streamlining Risk-Based Approaches for an Optimal End-to-End GRC Framework within the Organization" at Strategic Risk Leaders conference in Dubai on October this year, find more here https://bit.ly/2LjsVi3

ABOUT THE AUTHOR

Arif Zaman brings with more than a decade of proven experience in internal audit, risk management, and fraud investigation. He is the Head of Internal Audit at Private Joint Stock Company based in Dubai, UAE. He holds MSc in Professional Accountancy from the University of London and BSc Hons in Applied Accounting from Oxford Brookes University along with an impressive set of professional certification including ACCA, CIA, CISA, CFE, CCSA, CRMA, CRBA, CPA and CGA etc.

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