There is a shortage of candidates for senior level risk positions, according to recent guidance aimed at helping organisations fill their top positions, which was published by IRM at its 10th Annual Risk Leaders conference in November.
The document – How to hire a great risk officer – calls on organisations to ensure that their professional development schemes and succession plans nurture sufficient talent for the future. That is one of the reasons that IRM is also introducing a new advisory service to provide candidate assessment support for organisations around the world seeking to make top level risk appointments.
“Effective risk leadership is an essential component of a healthy risk culture. Corporate governance codes around the world have underlined that you must have the right people and resources in place. Organisations face new risks and opportunities associated with digital disruption, geo-political and economic volatility, environmental responsibilities and social change,” Socrates Coudounaris, BEng (Hons) MSc FCII CFIRM, Chair of IRM said. “Ultimately, the responsibility for risk management rests with the board, but that board needs to have confidence that they are delegating day-to-day responsibility to a suitably competent person, who will also be responsible for giving them the highest quality advice to support risk based decision making.”
The new guidance is based on IRM’s professional standards and is aimed at organisations of all types seeking to recruit a Chief Risk Officer (CRO), perhaps their first, or to make other senior risk appointments. CRO refers to the most senior executive in the organisation with responsibility and accountability for risk management, whatever their actual job title. In some sectors, particularly financial services, the role of CRO is stipulated by regulation. Other organisations have come to see the merits of such an appointment as part of a process of maturing their risk management, ensuring it adds value to the business.
The document gives guidance on:
• Understanding the context of the CRO appointment
• Identifying the key skills and attributes
• The recruitment process and how to assess candidates
The guidance helps organisations work through the decisions they need to take in creating a CRO role through posing key questions, such as what is the organisation’s business model and how does it create value, and, crucially, how will the CRO help it achieve success in those areas?
For those businesses not comfortable, or able, to choose their own selection processes, the document provides practical advice on how to choose the right executive search firm. “Don’t over-rely on cost and track record when deciding who to partner with – take a rounded view,” it says.
IRM has worked with recruitment experts to combine an understanding of risk management expertise with guidance on how to go about a modern recruitment process.
Recruitment expert Ulrich Seega, the main report author, added, ‘The aim of this guidance was to bring together today’s best practice in recruitment with the specialist technical knowledge about risk management offered by IRM. Organisations today are looking for CROs who display not only technical expertise at the highest level but also the appropriate behavioural characteristics relating to matters like change and leadership. This guidance will help organisations define what they need and how to go about finding it.”
Download copies of How to hire a great chief risk officer here.