Risk Management and Risk Appetite
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Overview
Managing risk is a key part of running your business. Volatile prices in commodity and financial markets, shifts in strategic conditions (e.g. technology, demand and supply), human misconduct, operational disruptions, they all may impact the bottom line in an unexpected way. But this does not mean you cannot take any steps to minimize the negative impacts and to take advantage of the opportunities.
By attending this Short Course you will learn how to turn the uncertainties of future outcomes into a competitive advantage for your company: identify risk, measure its consequences, and balance the risk exposure against your company`s appetite for risk. You will become confident to manage the risk profile of practical business situations. Creating a risk focussed organization will become critical to successfully protect the company against downside losses and maximize upside returns relative to their risk. And this is short of a complete change of company culture.
Topics Covered
Fundamental to risk management is an understanding of what risk is about, what factors drive risk in specific situations, and what attitudes can be taken to manage risk. Risk will be looked at from both, a personal and a business perspective as they determine a company`s appetite for risk taking.
Practical business examples for financial, operational, and strategic risks are visited, and you will identify the relevant risk drivers and discuss their interactions.
Risks can only be managed when they are measured! Therefore, participants are asked to do some simple calculations of statistical ratios, such as mean values, standard deviations, and net present values. To meaningfully discuss concepts of managing risk vs. return, a basic understanding of management sciences and finance theory will be helpful.
The management process of identification, analysis, assessment, controlling, and mitigation of risks will be discussed in the context of concrete decision-making situations in financial services and manufacturing. Establishing a comprehensive, enterprise-wide chance/risk profile will provide the platform for reducing cost. Setting risk limits and allocating economic (risk) capital to line management and projects is the ultimate top-down decision to improve risk adjusted returns within the accepted risk tolerance.
Subsequent to prominent business failures in the financial service industry as well as in manufacturing the regulatory and compliance framework for the conduct of business ( OECD, SOX,Coporate Governance in New Zealand, Basel II) is sharpening up. It will be examined how this reflects on the responsibilities of members of the board and the organisation of risk management.
Who should attend
This Short Course is aimed at Directors, executive managers and line managers across all organisations. It is a must for any manager looking for value generation by limiting risks and exploiting opportunities. Introducing an integrated management of risks and chances will trigger a cultural revolution in your business.
This Short Course will also benefit accountants, auditors, compliance practitioners and people with responsibility for risk management who want to look into the economic benefits of risk management beyond the corporate governance framework
Outcomes
You will:
- learn how to measure risk
- appreciate the value of information for making decisions under risk
- realize the importance of correlations between risk drivers
- see the impact risk appetite has on the downside of potential losses
- learn what determines individual and company risk behaviour
- learn how to stabilize volatilities and
- learn to balance risks against returns
- find solutions for typical business situations under risk
- learn to map the operational risks
- understand the meaning of wild cards and real options
- learn to enhance the efficient use of capital
Taking this Short Course will open up another dimension for running your business successfully. To make the most out of it, bring your calculator and/or laptop!