Zhetcho Kalitchin and Ivo Miltchanski from FERMA’s most recent member, the Bulgarian risk management association BRiMA, describe how risk management is developing in South-Eastern Europe.

In Bulgaria and most Balkan countries, the economic environment is varied and competitive. Costs for risk management are generally considered too high, and therefore possible economic losses and scenarios are not examined by a professional risk manager. Enterprises rarely rely on risk management when it comes to getting a competitive advantage or ensuring the company’s goals, business continuity and development. A risk manager is only employed in rare situations, at very large industrial enterprises and not within small and medium size enterprises.

Usually companies feel reluctant to use risk management as a tool in the process of implementing innovation in their production/service schemes or range of products. Most often, boards and other decision makers are not convinced that implementation of risk management methodologies and strategies will increase the productivity and security of the enterprise.

Currently, the widely adopted understanding of risk management is narrow mindedly connected only with financial risk analysis and not physical exposures and emerging risks. In many cases, the possible causes of disruptions for a given company are commonly neglected or not even identified. For example, supply chain analysis is widely considered solely an obligation of the marketing department and not a risk management matter.

Bearing in mind the necessity for regulatory changes coming to the European Union in the near future, there is a need to update strategies on a government level in the region as well. To cope with emerging risks and mitigate large scale economic disasters, these updates will need the states’ attention, and we are in discussion with risk managers and members of the academic community in order to prepare a functional framework for analysis, risk identification, implementation of risk mitigation measures and constant updating according to the changing environment.

BRIMA is only the second risk management association in the Balkans. Our main goal is to gather a critical mass of forward-thinking professionals in the field of risk management and combine their efforts in our mission to develop the profession in the Balkans.

Considering the current demand for risk management and the challenges which stand before us, BRiMA fully supports the need to implement FERMA’s slogan – ‘Education, Communication, Leadership’, and we will work towards the creation of a rimap® education center in the Balkan region.

Zhetcho Kalitchin is the President of BRiMA and Ivo Miltchanski is a member of the board of BRiMA.