Toward a more sovereign Europe: risk management’s contribution
The Federation of European Risk Management Associations (FERMA) has issued a statement on the role of risk management in support of the goal of the French Presidency of the European Council to further enhance Europe’s strategic autonomy and sovereignty. France’s Presidency of the European Council began on 1 January and continues until 30 June.
In its paper, “Contribution to the French Presidency agenda – A more sovereign Europe“, FERMA states: “Europe’s strategic autonomy and ability to defend our values and interests rest squarely on the strength of its businesses and communities. As risk managers, our role is to coordinate awareness and action across corporate functions so that organisations are more resilient whatever threats they face.”
FERMAs paper highlights the links between its work and the priorities of the French Presidency in three key areas of the French Presidency programme (which can be found here):
- Economic recovery (systemic risks and risk transfer, including captives)
- Digital issues (cyber risks and cyber insurance)
- Ecological transition (sustainability and insurability)
For each of these categories, FERMA presents the challenges faced by European businesses, explains how risk management contributes to the ambitions of the French Presidency and asks European policymakers for specific measures during this period. For instance, FERMA looks to the French Presidency to aim for a final text on Solvency II that will put the regulatory requirements for captives on a basis that is truly proportional to their risk-profile.
FERMA also draws attention to the growing concern of risk managers about a “protection gap” between the risk transfer capacity of the insurance market and the exposures that businesses face. These include more intense and severe natural hazards as a result of climate change, cyber risks and the transition to sustainability and a net zero carbon economy. FERMA warns policymakers that EU citizens and businesses could be left with no risk transfer mechanism or financial protection for certain substantial losses.
Said FERMA President Dirk Wegener: “In our paper, we outline the views and concerns of the risk managers on matters that will be debated during the French Presidency. We wish to bring our unique expertise in risk and insurance management to support EU policy makers to respond to the future with confidence and contribute to the transformation and resilience of Europe’s economy.”