On 2/4, Enterprise Risk Management Lecturer Celia Kapsomera participated in a panel discussion hosted by the Global Institute of Financial Professionals, "Risk Management in U.S. Financial Markets: 2021 Prospects.”
Kapsomera quoted a Gartner (Corporate Executive Board) study on negative events leading to significant drops in shareholder value. The report found that strategic risks --a category of risks related to unexpected changes in key elements of strategy formulation or execution--accounted for 65% of these negative events. “So,” Kapsomera asked, “what can companies do to play a more ‘offensive’ role in the post-COVID economy?” She outlined the risk challenges and opportunities that lay ahead.
Risk analytics--the science of uncovering the max information contained in companies’ large amount of data--are used more intensely now than ever before to drive risk management. Predictive analytics are utilized in a more integrative fashion to construct scorecards and other tools (dashboards, visualizations, scenario analysis) that are aimed at refining and enhancing early warning signals.
Companies should keep in mind the following risk management challenges and opportunities: As the risk management discipline is maturing, more emphasis is being placed on the alignment of risk identification, mitigation and oversight with strategic planning and performance.
The drivers of this force are advancements due to innovation and experimentation, enhanced analytic capabilities, new workplace technologies, disruptive new business models, and decentralization that is creating flatter organizations. “Risk analytics--the science of uncovering the max information contained in companies’ large amount of data--are used more intensely now than ever before to drive risk management. Predictive analytics are utilized in a more integrative fashion to construct scorecards and other tools (dashboards, visualizations, scenario analysis) that are aimed at refining and enhancing early warning signals,” said Kapsomera.
She also identified the importance of scanning the horizon for emerging risks in Information Technology as a significant risk source, but also as an enabler of effective risk management, as well as the need for flexibility of the global supply chain as major factors at play in balancing upside and downside risks in the current business environment.
Kapsomera is the Principal of CSK Insurance Risk Solutions, where she specializes in Strategic Planning and Enterprise Risk Management of Property and Casualty insurance and reinsurance companies. She has extensive experience in strategy, planning, reporting, research and analysis with over twenty years of pratice in the insurance and reinsurance industry.
Watch the full GIFP panel here.
Learn more about Columbia's M.S. in Enterprise Risk Management.
