Masterclass Insights: An Introduction to Strategic Risk Management for Leaders

In a complex and inter-connected world the importance of good risk management practices has never been more important. Effective risk management can offer genuine strategic advantage. It should be seen as a strategic and people-focussed discipline, embracing elements of financial and operational competence. The absence or mismanagement of such practices has had a devastating impact on many organisations.

Risk management may be expressed simply as the identification, analysis and control of those risks that can affect or influence an organisation, industry or commercial undertaking’s ability to achieve its objectives. Risk management requires a combination of financial and operational controls and the application of a risk management framework including: financial risk control, risk identification, risk assessment, monitoring and review, all of which require a robust infrastructure which need to be balanced with the organisations need to be innovative and agile.

Historically many firms second line functions such as legal, compliance, audit, credit risk and market risk were managed in separate organisational silos. Operational risk was generally the responsibility of business units as part of their daily activities. Risk management was focused primarily on financial, predictable and quantifiable risks related to loss prevention. Over time, risk management has evolved to include corporate governance, alignment to strategic objectives, capital adequacy and stakeholder value. Additionally, risk management is now a standing item on corporate board agendas.

The evolution of risk management has developed, more recently, into a more integrated approach embracing governance, risk and compliance (GRC) functionality and firms taking a more holistic approach to risk. Holistic risk management is the term normally associated with the application of a range of skills and disciplines to risk or a variety of risks. In such a case, risk management brings together the skills of the risk practitioner to manage a number of risks that are multi-disciplinary in nature: these risks may include legal, financial, technical, accounting, marketing and management. Strategic risk is a principal factor in the holistic management of risks within a financial services environment.

As part of the new Level 7 Professional Postgraduate Diploma (PPgDip) in Private Wealth Advising programme, this specialist topic explores:

  • The interrelationship between risks
  • Implementing an integrated risk strategy at corporate level
  • Strategic capabilities for managing risks
  • A comparative study of enterprise-wide risk management with risk management (ERM) and compliance (GRC) solutions
  • Factors involved in decision making
  • The impact of short and long-term risk horizons in everyday activities within firms
  • Introduces the role of risk management
  • Strategies for shaping and aligning the consequential risks faced by
  • organisations from the perspective of clients, business participants (i.e. shareholders) and regulators
  • The centrality of strategic risk management in stabilising firms and their resilience to risk
  • Risk governance
  • An analysis of risk appetite to provide a framework for taking risks at all levels of firms
  • The reporting of risks in qualitative and quantitative terms
  • The indicators and policies of macro prudential risks and their regulation
  • The micro prudential regulation of individual firms where the firm considers taking excessive financial risks
  • Key drivers of risk
  • The interrelationship between internal and external drivers that impact upon financial services firms

For those interested in the programme and looking to explore what is covered in the full programme syllabus, you must register your details and interest with CLT International by visiting STEP Postgraduate Diploma - Syllabus.

You will also be provided with access to the exclusive informative ‘Standards, Research & Assessment’ webinar(s) which will explain how candidate performance is assessed.