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The State of Risk Management: Survey Report 2021

The Metricstream 2021 survey and report on the state of Risk Management showed that organisations with agile IRM (Integrated Risk Management) solutions responded better to the pandemic driven challenges.

The survey results showed that:

  • nearly half of the respondents identified cybersecurity as the top risk as businesses switched to digital mode due to the pandemic, other risks included:
    • Compliance
    • Operational risk
  • aligning risk priorities with business strategy emerged as the biggest challenge being faced by organizations, other challenges included:
    • Identifying emerging risks
    • Unreliable data quality to compute risks
  • In the post-pandemic world, determining the effectiveness of cyber security risk management and operational resilience is a top priority with:
  • More than half of the organisations surveyed had deployed an integrated risk management solution and did not need to make any changes to research programs and strategies during the pandemic.

Need for IRM programmes

The report argues that:

  • “The traditional approach to risk management that relied primarily on siloed processes is no longer relevant and effective. In today’s fast-paced and complex operational environment, what business leaders want is comprehensive and deeper visibility into the organization’s risk profile, tolerance, and appetite, and the effectiveness of control frameworks and risk mitigation measures.
  • This could be achieved by adopting an integrated approach to risk management that ties together various functions—audit, risk, compliance, cybersecurity, business continuity, and third-party—into one overarching framework. This way, the IRM approach will provide a better understanding of risk relationships and impact. In addition, aggregating all risk-related issues and data across different business units and functions will empower senior management and leadership in making well-informed business decisions.”

The diagram below shows how an IRM programmes is structured:

Source & Copyright©2021 – MetricStream

The problem with RM solutions

The survey reviewed how respondents used risk management solutions:

Source & Copyright©2021 – MetricStream

The overall conclusion from the report and survey was that, “Considering the pandemic, emerging geo-political risks, and increasing dependency on scattered third-parties, it has become critical for organizations to aggregate risks and ensure complete risk visibility based on the geographical structure.” (Which many are clearly not doing.)

CTMfile take: This rather incomplete report, e.g. no details of survey respondents, brings together an important and fundamental conclusion that companies need to aggregate all their risks and ensure they have in a comprehensive integrated and responsive risk management system to do this. An IRM is vital for survival.

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