Winner of this year’s Risk Mangement Team of the Year, NETS head of enterprise risk management and compliance, Wilson Yeo, discusses the electronic payment service provider’s strong risk culture.
NETS is delighted to receive this award. The award is testament to NETS’ belief in a strong risk management culture and reflects the commitment of our colleagues and partners who have been strong supporters of our risk management initiatives.
WHY IS RISK CULTURE SO IMPORTANT?
A strong risk culture and the right attitude to risk is the foundation of a risk management framework and determines the success or failure of risk management programmes. Without a strong risk culture, the risk management team by itself will not be able to realise its fullest value for the benefit of the company. An effective risk culture encourages open communication and timely remediation of key risks and potential warning signs before a major disaster strikes the company.
It also demonstrates the company’s commitment towards ethical and responsible business growth.
Companies with a misaligned or weak risk culture will allow non-compliance activities to be encouraged or ignored. This could eventually lead to financial losses or major incidents resulting in irreversible damage to the company’s reputation that had been painstakingly built up over the years.
HOW DO YOU GET CONSISTENT BUY-IN FROM YOUR COMPANY FOR YOUR RISK IDEAS?
First, establish regular internal team meetings within the risk team to brainstorm, formulate and refine the risk ideas. Secondly, it is important to conduct back-testing (if viable) to assess the viability of the risk ideas and ‘test drive’ them with a few divisions before rolling it out enterprise wide. Here are some of the tried and tested approaches to get buy-in from the company:
• Extensive socialising of ideas to solicit buy-in (e.g., conducting regular Risk Workgroup Committee meetings with Risk Champions and townhalls represented by all impacted divisions).
• Seek to understand constraints and challenges that stakeholders face and be open to explore innovative ways to address their concerns while still forging ahead to implement the risk ideas.
• Accept feedback and constructive suggestions on ways to fine-tune the risk ideas. It is important that stakeholders know that the risk team is receptive to their suggestions.
WHAT ADVICE DO YOU HAVE FOR OTHER RISK MANAGERS LOOKING TO DO WHAT YOU DID?
• Recognise that risk management culture is a long journey where all risk managers (even the most successful) face challenges, obstacles and issues in implementing well-intended risk management programmes. Do not be discouraged by setbacks.
• Develop a short- and long-term strategic plan for implementing risk initiatives. Focus on quick wins for the short-term plans, to get the momentum going, and get early buy-in and support from management.
• Constant learning is important as the risk landscape is never stagnant; there are new regulations, emerging risks arising from the digital revolution and new business models, innovative data analytics and sophisticated AI-powered risk tools that could be game-changers for risk management.
• Join a group of like-minded risk managers who will encourage, share ideas and spur you to raise the risk management bar and reach greater heights!