The risk manager’s challenge: how to communicate effectively? – Risk and insurance managers are at the crossroad of major information flows within the organisation, and they have a crucial role in communicating and consulting with both internal and external stakeholders as the message from day three of the FERMA Forum 2017. It was devoted to the third theme of Jo Willaert’s presidency: communication.
The day’s sessions, workshops and a keynote address from Jamie Shea, Deputy Assistant Secretary General for the Emerging Security Challenges Division of NATO, highlighted the dual aspect of communications for the risk manager. First the risk manager has to communicate effectively on risk and insurance within the organisation. Second, the company needs a structure and strategy for communicating effectively with all its stakeholders, and this comes under the heading of enterprise risk management.
The risk manager should be at the centre of the communication hub, said Andy Weitz, Senior Vice President Global Marketing & Communication for Aon. Speaking in the workshop on how to face a brand reputation attack, he stressed the overwhelming switch to intangible assets as value generators for companies which has made them very vulnerable to reputation damage. He commented: “In the past, the risk manager was usually brought in post-event to deal with liabilities losses and recoveries from insurers. The risk manager needs a central role doing scenario planning and working with other stakeholders.”
In their workshop on non-damage business interruption Laurent Nihoul, General Manager Corporate Risk & Insurance, Arcelor Mittal, and Fabrice Frère, Director Aon Global Risk Consulting Luxembourg, concentrated primarily on communication on insurance matters within and without the organisation. They argued that the dialogue with stakeholders should be put in terms of their own objectives, rather than insurance technicalities because they are not specialists.
A drawing is worth a thousand words, said Laurent Nihoul. Flowcharts, for example, facilitated understanding, especially in a global player like Arcelor Mittal where most staff do not have English as their first language. Keeping it simple should be at the heart of the risk manager’s communication skills was the message. Laurent Nihoul and Fabrice Frère suggested the participants meditate on this warning from Albert Einstein: “If you can’t explain it simply, maybe you don’t understand well enough yet.”
Moving to the ERM aspect of communication, two speakers described dealing with major crises under the spotlight of attention from the world’s press, politicians and social media. One was Hugues Le Bret, today Chairman of French-based electronic payment facilitator, Compte-Nickel but previously Director of Communications for Société Générale for 10 years. He described the necessity of focussing clearly on the real target of preventing business loss when a company has to deal with a crisis such as the bank faced in the 2008 financial crisis when a rogue trader cost it nearly 5 billion in losses.
The last keynote speaker and, indeed, final speaker of the Forum was Jamie Shea on the subject of risk communication in times of crisis. He spoke mainly from the perspective of a military based organisation, but his lessons have corporate implications.
There, he said, are two sorts of crises: those which the organisation has planned for, even if they did not happen as expected, and those which were unexpected. “Black swans are real,” he said meaning that it was impossible to anticipate everything that could happen.
Strategic awareness, adaptable procedures and clear goals were essential, said Jamie Shea. “A good media plan won’t solve the crisis but a bad one will make it worse.”