Two corporate risk managers reported very different results with enterprise risk management (ERM) progress at their companies during a recent webinar.
The webinar, "RIMS Benchmark Book/The Live Event," was presented by Advisen and included live commentary from industry leaders.
"The actual process of ERM is nonexistent at Global Crossing," says Len Resto, director of risk management for the company. "That has been despite my trying to get it to grow in that direction, but it's been a tough sell."
He continues that while his immediate boss is sold on ERM, "the higher up you go, there seems to be less inclination to do it."
Looking at the same risks year after year, Resto says, produces many of the same risk factors. "So it's been a tough sell, and now that Global Crossing has been acquired by another company [Level 3 Communications], the ERM effort is dead for the moment. But we're hoping the new company picks it up."
Rich Sarnie, vice president of risk management for the Great Atlantic & Pacific Tea Co., says he has better news, noting that within the past six months, his company "has totally embraced ERM."
Sarnie adds that ERM is "really not that complex" and that his goal in leading the company's ERM program is to keep it simple.
The way ERM was initiated, he says, was by having each business leader in the company come to a meeting bringing a homework assignment to identify a risk that, if it happens, "will shut the door."
About 30 risks were listed and then prioritized to determine which risks the group would work on first.
The list was narrowed to 10, he says, and the same risk-management strategy will be applied to them as "on any risk, whether it's insurable or not. Can you avoid it, can you prevent it, can you mitigate it, or can you transfer it?"
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