We are living in an increasingly fractured and volatile world. Inflation is increasing, interest rates are rising, energy prices are going nowhere but up and when the world changes, so does risk. Risk managers have to be more adaptable than ever and ready to face any challenge. But what concerns are front of mind now? We asked seven international CROs: What's keeping you awake at night?
Federico Galizia, Chief Risk Officer, Inter-American Development Bank (IDB)
Normalising interest rates is necessary and potentially positive for the long run. It will however be quite challenging for financial markets and the economy to absorb in the short run.
Mahadevan Shivkumar, Chief Risk Officer, CCIB, Standard Chartered Bank
Challenging macro outlook, unpredictable geopolitical dynamics, extreme volatilities in various asset classes, supply chain challenges, changing liquidity/pricing landscape and the need to always stay operationally resilient.
Lakshmi Shyam-Sunder, Vice President and Group Chief Risk Officer, World Bank Group
A fractured and fractious world.
Carolina Thomaz, Chief Risk Officer, Sygnum Bank AG
Geopolitical, information security and business continuity risks.
Sajid Iqbal, Deputy CRO, Habib Bank AG Zurich
We are living in perilous times. The post-pandemic recovery becomes more challenging with the global inflation crisis and the devastating climate change effects we are witnessing around the globe. So, first of my top concerns is ESG risk (strategy, investment, credit decisions, risk management and external reporting). Second is inflation and hedging risk and last, but not the least, is the very fast-growing talent and successions risk in financial services. It's getting difficult to retain top talent due to lack of growth opportunities and disengagement. There are poor succession planning strategies in the financial service industry, creating talent and leadership gaps.
Thabile Nyaba, Chief Risk Officer, Old Mutual Insure and President at IRMSA
Although we are living in volatile, complex and multifaceted times, this uncertainty allows us so many possibilities – remember, when nothing is certain anything is possible. We are facing so many opportunities and possibilities evolving from rapid change and emerging risks such as technology, digitisation and transformation – we need to embrace new ways of work and doing business and manage the many disruptions we are facing.
As we reposition risk management to look beyond strategy, performance and resilience, we are leveraging progress we have made already, bringing to the fore lessons learnt from previous risk events and disruptions – some are not new but may be more volatile and/or evolved. As risk managers, we are in the forefront of building resilience muscle for our people, organisations, industries and countries in order to navigate many global and local interconnected and complex disruptions that seem to be increasing in severity and frequency.
As risk leaders, we have been encouraged to interrogate our current reality, understand scenarios or risk events that might play out and to influence them by driving for swift, integrated and decisive actions with the understanding that the next risk event to materialise will be dependent on the quality of our response strategies.
Michiel Haasbroek, Chief Risk Officer, Banque Internationale à Luxembourg (Suisse) SA
I am generally a sound sleeper, but if I interpret this question as what is my greatest concern at the moment, it is third party dependency and developments in the economy and financial markets. Do we really understand what the transition from negative rates will bring?
