|ContinuitySA Press Release|
Building resilience is key to managing risk in 2017 and beyond
|Issued by: Warstreet Marketing|
[Johannesburg, 11 January 2017]
The outcomes-based approach of King IVTM is a timely invitation for corporate South Africa to get better at managing risk in a world that is getting more risky by the day, says Michael Davies, CEO of ContinuitySA. Davies argues that King IVTM is directing organisations to see risk holistically, and ultimately to build resilience.
"Principle 11 of King IVTM speaks to governing risk in a way that helps an organisation to set and achieve its strategic objectives. This is a call to change the way organisations see risk, with many implications. To my mind, one of the most critical mind-set changes will be to move from a focus on identifying risks – though that remains important – to building resilience," Davies says.
At the end of every year, the ContinuitySA team attempts to identify what will define the risk landscape for the coming year. Meeting in November 2016, the team agreed that the main point to make was that risk and its effects were becoming increasingly unpredictable. Factors driving this unpredictability include unprecedented geo-political uncertainty coupled with an increasingly integrated world, in which the interconnectedness of digital markets and supply chains is now mirrored by large-scale human migrations that effectively globalise risk.
"Identifying and preparing for specific risks is becoming less useful because risks are less discrete than they used to be," Davies observes. "Obviously, while one wants to know what is likely to happen, one needs to be aware that when a risk materialises, its effects are likely to be both widespread and hard to predict, especially as supply chains integrate still more closely. One might almost say that a risk is a trigger for negative business outcomes."The only solution, Davies argues, is for governing bodies to consider risk from multiple angles, and to devote time to making their organisations more resilient; that is, more able to recover from any negative event.
Within this context, ContinuitySA believes that the following areas warrant special consideration as organisations plan for resilience in 2017:
* Clarify your approach to cyber risk, including mobility and the Internet of Things. The growing importance of data as a source of competitive advantage and source of value is attracting the interest of regulators – and criminal syndicates. The risk is exponentially enhanced by the mobile revolution, which is seeing corporate networks become boundaryless. "There are more mobile connections than there are people in South Africa, and malware and phishing scams are now prevalent in the mobile world, creating a significant threat for all organisations on all sorts of levels," says Davies.
In conclusion, says Davies, global research into the state of enterprise resilience reveals that effective leadership is the highest priority when it comes to implementing resilience principles, but over one-third (37%) lack the right skills or talent to drive resilience – a dramatic 17% rise from 2015.
"Data like this supports the view that the case for working with a specialist resilience partner has never been stronger. The ability to recover from an unexpected disaster has become a critical driver of sustainability," he concludes.
** King IV and the King IV Report on Corporate Governance are trademarks of the Institute of Directors in Southern Africa NPC. King IVTM was launched on 1 November 2016.