Resilience requires a 360 degree view of risk
In an uncertain world, companies need to look at risk from a 360 degree perspective and not focus on the typical risk committee perceptions of risk. This was the advice from Sir Jeremy Greenstock, Chairman of Gatehouse Advisory Partners and former high level British diplomat. “We can identify the big trends,’ he said, “but not the particular symptoms of those trends, and that is what companies need to take into account in adapting and diversifying.”
Sir Jeremy was a member of the high level panel discussion that opened the second day of the Forum following a keynote speech by the former Prime Minister and Foreign Minister of Sweden, Carl Bildt. In his address, Carl Bildt placed Europe in the context of a wider world view. He argued that we had to get used to turbulent times as “the new normal” after the end of a quarter-century which was probably the best period in history for humanity. “We must build resilience of our organisations and our societies because the shocks will be there.”
Carl Bildt’s speech and the panel discussion which followed covered many of the topics which are creating the risk environment of today: shifts in world power and growth in population, diminished faith in the liberal world order, the politics of identity, Brexit and the future of Europe, and the digital revolution.
Increasing protectionism is seen as part of this new world order, but Ludovic Subran, Chief Economist, Euler Hermes, argued that protectionism in goods and services is actually no higher than it was a year ago. Instead, he warned that the real risk is financial protectionism which is growing.
Kadidja Sinz, Head of Europe for Liberty Specialty Markets, said the insurance industry was going through a huge amount of change so that it would be “fit for purpose” in future, both as a result of Brexit and to provide solutions for changing business models. “We are making scenarios so that our products are in demand. We see great opportunities – not in isolation but in co-operation.”
Caarl Bidlt summed up the caution and optimism of the panel: “In the middle of the risks and the mess, we must also look for opportunities.”