Risk Management

Risk-Based Strategic Analysis Critical to Long-Term Success:  In the midst of the financial sector meltdown, directors and executives are asking innumerable questions. One, in particular, seems central: “In our quest for pay for performance, have we—boards, executives, and shareowners alike—created pressure points that influence risk-taking behaviours in unintended ways?”

Source: Compliance Week

Survey: Boards Are Often Blind to Major Risks:  By a wide majority, directors of financial services firms believe that they had little chance of spotting the kinds of problems at their respective firms that plunged the world into a global financial meltdown.

Source: cfo.com

How high-fliers turned into Black Swans:  In 2006, an author by the name of Nassim Nicholas Taleb wrote a book called The Black Swan, the title describing events that are rare but have significant impacts. The credit crunch and banking crisis now being played out definitely qualifies as a Black Swan. No one saw it coming and no one knows how it is going to end.

Source: The Dominion Post

 Governance & Compliance 

New York broker arrested over $75bn trading fraud - Banks, top investors "heavily exposed":  Prosecutors allege that a decades-long veteran of Wall Street and pillar of the US financial community, confessed to losing at least $US50 billion ($74.4 billion) in the so-called Ponzi scheme or pyramid fraud.

Source: News.com.au

Anti-corruption: Getting rid of graft:  Asian governments have far to go before they root out corruption. Several Asian countries continue to rank among the world’s most corrupt nations in the latest Transparency International Corruption Perceptions Index, published in September.

Source: Ethical Corporation

Court orders Qantas to pay $20m:  The Federal Court of Australia has ordered national carrier Qantas Airways Ltd to pay $20 million in pecuniary penalties for breaching the price-fixing provisions of the Trade Practices Act.

Source: Business Spectator

A holistic view of risk is essential for effective management:  In the wake of fraud at Société Générale, there existed a strong sense that risk management would remain a front-and-centre issue for a considerable period of time.  What few expected was that risk would assume so critical a position so soon - especially one that would percolate beyond the trading world and into the broader economy.

Source: Banking Tech

 Occ Health, Safety & Environment

$140,000 Fine After Wall Collapse:  A company has been slapped with a $140,000 fine over a wall collapse at its Taren Point recycling centre in 2006 that almost buried two people and crushed five new cars.

Source: The Leader

DID YOU KNOW?  Our GuardianERM.net system allows you to document/attach Safe Work Method Statements (SWMS), record incidents, incident statistics and treatment plans.  And, if you forget to fix problems on time…Guardian will email you!  More information

 Government

The Economic Costs of Reducing Greenhouse Emissions: Understanding Treasury’s Model:  Treasury’s climate change modelling exercise is the most extensive modelling exercise ever undertaken by the Australian Treasury. In the scenarios modelled, economic costs in 2050 for early movers are around 15 per cent lower than when everyone acts together, while costs for late movers are around 20 per cent higher.

Source: Australian Government Treasury

ASIC Capital markets update:  Commissioner Belinda Gibson talks about the need for good disclosure in a volatile markets and the Capital Markets Taskforce that was set up a year ago with a mandate to review ASIC’s record in the enforcement of market abuse offences and to design a strategy to improve ASIC’s performance.

Source: ASIC

  Internal Audit

NSW Department of Local Government Internal Audit Guidelines:  Internal audit is an essential component of a good governance framework for all councils. At both a management and councillor level, councils must strive to ensure there is a culture directed towards realising opportunities and managing risks that challenge local government. This guide is designed to help councils develop and implement internal audit and risk management frameworks that will in turn build community confidence in their managerial performance.

Source: DLG

 Can we help?

If you have any risk management, governance, audit or business continuity matters you would like to discuss, contact InConsult on 02 9241 1344.  

Seasons Greetings: The InConsult team would like to wish all our readers a Happy Christmas, safe holidays and a prosperous 2009.

  Need Temporary Staff?

In a market where many organisations are revisiting their strategies including restructuring/consolidating their businesses and cost cutting - do you need individuals that can simply come in and get the job done? 

Did you know that InConsult can help with short to medium term contract placements?  InConsult’s recruitment team have experts (with ‘big 4’ firm experience) across the following service offerings:

§      Project Advisory and Risk Management

§      Business Performance Improvement & Change Management

§      Integrated Risk Management and Compliance

§      Specialised Internal Audit projects/services

§      Project Management (all elements)

§      Business Continuity Management

Our matching of client needs to qualified experts allows us to help our clients obtain not only solid initial results, but transfer of knowledge to the business.  You benefit via reduced costs with a flexible workforce, faster implementation, reduced risk and greater success.

To discuss your needs in more detail, please contact Scott Barrett from InConsult’s recruitment team on 02 9241 1344.

 Enterprise Resilience

Pandemic report stresses need to be prepared:  The Emerging Risks Team at Lloyd’s has issued a new report on the threat posed by a global pandemic.  Its report “Pandemic - Potential Insurance Impacts” focuses on the threat to the global business community and, in particular, the insurance markets of a global pandemic.

Source: Lloyds.com

OUR TIP: A business continuity management plan should be an action driven document containing  prioritised management actions in the event of an emergency, crisis and/or major disruptions including loss of staff, loss of building, loss of data and loss of key dependencies.  We suggest you keep the business continuity theory in a separate document titled BCM Framework to document the approach, methodology, maintenance and testing schedule. More information

Hong Kong reports bird flu outbreak:  Three dead chickens tested positive for bird flu in Hong Kong, prompting the city to suspend poultry imports for 21 days and begin slaughtering 80,000 birds, an official said Tuesday. "We feel that Hong Kong is facing a new alert for bird flu," said York Chow, secretary for food and health.

Source: Associated Press

Organizational resilience:  This article highlights the changing environment in which we live and work to stimulate thought regarding the issues associated with the common processes to identify and measure risks.  It looks at the challenge the generally accepted belief that recovery to the point prior to an incident is appropriate and explores the elements and the associated benefits of a truly integrated resilience program.

Source: Continuity Central

 Financial Management

Crisis Demands New CFO Skills:  The preferred skill set for CFOs is shifting quickly in the heat of the economic turmoil and the credit crisis. For many companies seeking finance leaders, the accounting and financial reporting acumen deemed so crucial in the early years of the Sarbanes-Oxley era has slid down the wish list over the past 12 months.

Source: CFO.com

Top Concerns of CFOs: Rest assured, another Great Depression is not on the way. That's because it's already here — at least as an accurate description of the psychological state of most finance executives.  CFOs were anxious about sputtering consumer demand and stalled credit markets, along with the continued volatility in the cost of fuel and other commodities, according to the most recent Duke University/CFO Global Business Outlook Survey.

Source: CFO.com

 Financial Services

Insurers' risk management lacking, says FSA:  UK regulator the FSA says that while the insurance industry has embraced changes to the capital regime, some insurers are falling short in their risk management procedures, pointing to non-financial risks such as strategic risk, business models, financial crime and operational risks as key factors.

Source: Money Marketing

Financial Crisis Intensifies Interest in Risk Management Among Insurance CFOs:  Improved risk management is the top priority of CFOs in reaction to the current financial crisis, ahead of short- and long-term access to capital, according to a Towers Perrin survey of finance executives at major U.S. corporations.

Source: Towers Perrin

Banks Must Aggregate Risk Management Efforts:  Financial crisis shows that FIs need to break down silos when it comes to dealing with risk. No matter your opinion on the government's $700 billion bailout plan, there's no denying that senior management at most Wall Street firms relied on weak risk management strategies to inform critical decisions involving opaque and complex structured products at the heart of the subprime meltdown.

Source: banktech.com