Climate Change, Cybersecurity, Environment, Societal and Governance (ESG) and Geopolitics-Driven Inflation Are Key Business Concerns, Say India’s Chief Risk Officers

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Mumbai, 18 October 2022: Climate change, cybersecurity, geopolitics-driven inflation and ESG emerged as key business risks, identified by Chief Risk Officers (CROs) in a poll conducted during the first ERM Summit, organized by the NISM (an educational initiative of Securities and Exchange Board of India) and Institute of Risk Management (IRM), India Affiliate, the world’s leading professional body for ERM examinations. The concerns raised by the attending CROs are in line with the IRM’s Risk Predictions 2021 report.

Various regulatory bodies in India have also recognized the criticality of these risks and the need to proactively manage them with risk experts and committees. In November 2021, SEBI amended the Listing Obligations and Disclosure Requirements (LODR), which already mandated the constitution of a Risk Management Committee (RMC), to include the top 1000 listed entities by market capitalization. SEBI has also mandated a Risk Management Framework (RMF) for all Mutual Funds and Asset Management Companies, along with requiring the appointment of a CRO. Additionally, the Reserve Bank of India (RBI) also requires banks, as well as Non-Banking Financial Companies (NBFCs) with assets over INR 5,000 crores, to appoint a CRO to institute and oversee risk management. Similarly, the Insurance Regulatory and Development Authority of India (IRDAI) mandates all insurers to have an RMC in place, under the supervision of a CRO.  

The Enterprise Risk Management Summit, was organized exclusively for Chief Risk Officers, risk management committee members, and independent directors, and was attended by business and risk leaders from a variety of sectors, including pharmaceuticals, technology, real estate, retail, banking, and finance. Participants engaged in networking and the summit provided an excellent platform for brainstorming, ideation and cross-sectorial learning and collaboration. 

Dr CKG Nair, Director, NISM, in his opening remarks, deliberated on the extent and impact of climate, technology, cyber and macroeconomic risks on the world order. He emphasized the importance of risk management and risk mitigation strategies in avoiding the potential consequences from unprecedented events. Thereafter, Dr. Nair welcomed the Chief Guest Ms. Jayashree Ramasubbu, CRO, L&T Technology Services Limited, and other esteemed guests. He also acknowledged the significance of organizing the ERM Summit and lauded the efforts of Mr Hersh Shah, CEO, IRM, India Affiliate for the same.  The Director’s speech set the tone for the whole summit.

Discussing the current business environment, Hersh Shah, CEO, IRM India Affiliate, said, “Organizations are currently focusing on a variety of issues, including how to handle the complexities affecting business, such as geopolitics, economic volatility, climate change, cybersecurity, and supply chain shortages, as well as the evolving regulatory landscape including ESG and other compliance matters. Companies have understood the potential of ERM as a tool for improved strategic value, for long-term business success and risk-based decision making. IRM India Affiliate and NISM are committed to developing a strong risk community, comprising of India’s risk experts, to drive this discourse, which is the only way towards a robust and thriving economy. The world has changed, and organizations need to do so as well, and our vast community of risk professionals will be at the forefront of this evolution.”

The Chief Guest Jayashree Ramasubbu, in the keynote address, emphasized several lessons drawn from her extensive experience as a risk leader. Other eminent speakers included Prabha Thomas, Chief Risk and Compliance Officer, TCS; Dr. Leena Vijayvargiy, CRO, HDFC Mutual Fund; Deepak Viegas, Global Head IA, and Risk Management, Cipla; Sunder Natarajan, CMIRM, CRO, IndiaFirst Life Insurance and Jyoti Ruparel, CMIRM, Enterprise Risk Expert.

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A workshop was conducted at the summit by Vishal Ruia, AMI Risk Leader and Partner, Consulting, EY India, to discuss the evolving risk landscape and risk appetite, horizon scanning to identify emerging threats, and the key emerging risk themes. In a live poll conducted by EY during the workshop, attendees identified climate risk, cyber risk, ESG related risks and geopolitical crisis as some of the top concerns for organizations. Vishal Ruia got the risk community engaged at the insightful workshop which highlighted mechanism and techniques of systematic horizon scanning to equip Chief Risk Officers to provide enhanced assurance to the Risk Management Committee. 

The panel discussion on Risk Management Committee Meetings also shed light on the importance of transparency and education to win the confidence of the Board and risk committee members.

About National Institute of Securities Markets (NISM)

NISM- is an educational institution registered as a public trust. It was established in 2006 by the Securities and Exchange Board of India (SEBI), the regulator of the securities markets in India. The institute carries out a wide range of educational, research and capacity building activities at various levels aimed at enhancing quality standards and professionalization of the securities markets. The institute’s six schools of excellence work in synergy towards achieving these goals.

The institute has six schools of excellence viz.

  • School for Securities Education (SSE)
  • School for Certification of Intermediaries (SCI)
  • School for Regulatory Studies and Supervision (SRSS)
  • School for Investor Education and Financial Literacy (SIEFL)
  • School for Corporate Governance (SCG)
  • School for Securities Information and Research (SSIR)

About Institute of Risk Management, India Affiliate

The Institute of Risk Management is the world’s leading professional body for enterprise risk management qualifications and memberships (levels 1 to 5). IRM publishes research and guidance, professional standards across the world. Our members (including members of the Institute of Operational Risk) work in all industries, in all risk disciplines, and across the public, private and not-for-profit sectors in more than 143 countries. With 360 exam centers in India, candidates can earn the IRM designations by pursuing the global examinations through IRM India Affiliate. IRM India Affiliate has entered into knowledge partnerships with Invest India, National Institute for Micro, Small, and Medium Enterprises (Ministry of MSME), Eduvanz, JB Boda Group, Cipla, and Bombay Chartered Accountants Society. IRM India Affiliate has also collaborated with NMIMS to launch India’s first professional programmes in ERM covering IRM’s exams and, earlier, launched a report with AICTE (under the Ministry of Education) on ERM and the Indian Higher Education System. In addition, it also runs The CRO Circle with Deloitte India’s Risk Advisory. 

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