Copyright 2012-2013 Risk and Insurance Management Society, Inc. 1
RIMS Risk Maturity Model (RMM) Webinar with RIMS Chapter Officers
A Mutual Opportunity
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 2
A Virtual Presentation for Your Chapter
• Randy Besse – Saskatchewan Chapter• Carol Fox – RIMS• Steven Minsky – LogicManager
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 3
Answering the basic questions
• Carol Fox and Steve MinskyWho• Provide an educational forum for your chapter membersWhat• Scheduled to meet your chapter needsWhen• Wherever we can connect through the internetWhere• Using RIMS Adobe Connect platformHow• To provide a unique, sustainable, and practical experienceWhy
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 4
A “Win-Win” Proposition
Chapter Wins• “Ready” presentation• Delivered virtually• Something different• Build chapter camaraderie• Build more mature risk
management practices within the chapter
• Encourage continuing dialogue
RIMS Wins• Greater use of the RIMS Risk
Maturity Model• Encourage “friendly competition”
through regional benchmarking• Build more mature risk
management practices overall• Delivers on its mission to make
your organizations more successful
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 5
Poll: Have you taken the RIMS RMM Assessment?
o Yes, multiple timeso Yes, one timeo Started once, but did not finisho No, nevero Never heard of it before today
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 6
Delivering Value through RIMS Risk Maturity Model for
Enterprise Risk Management
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 7
Agenda
The Landscape The Plan Taking the RMM Assessment Using the Output A Proposition Questions
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 8
THE LANDSCAPE
We can't solve problems by using the same kind of thinking we used when we created them. Albert Einstein
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 9
The Risk Professional: Balancing Risk and Reward
Used with permission per RIMS license agreement with The Official Dilbert Store
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 10
The Evolving Role of the Risk Professional
Source: RIMS and The IIA Risk Management and Audit: Forging a Collaborative Alliance 2012
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 11
What are the Implications for Risk Management?
Proactive
Reactive
• Objectives Focused• Predictive Indicators• Foresight• Strategic• Creates and captures
value
• Event Focused• Post Action Response• After-thought• Transactional• Protects Value
Expanding organizational risk management competencies
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 12
THE PLANAny fool can know. The point is to understand. Albert Einstein
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 13
What Are Your Top Risks to Successful ERM?
Disabling Culture
Multiple Priorities
Goal Confusion
Execution Ability
“Whirlwind”What stands in the way of successful ERM at your organization?
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 14
Make sure that there is a risk management system in place in each business that includes
effective risk-control mechanisms as well as
information systems that flow up to senior management
Shape the risk principles and policies of the company, track the
capital risk capacity of the company, define who is
responsible for managing the specific risks within the
organization, and provide a framework for judging the effectiveness of risk-taking
You Need a Plan!
What else?
Quote Sources: Spencer Stuart
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 15
Why Use the RIMS Risk Maturity Model?
Bridges the gap between theory and practice Guide to incremental improvement over time Measurable ERM value, based on priorities Addresses rating agency criteria on key attribute areas Can be used to build an ERM blueprint Creates value for the organization Career development tool Breadth of use
Over 2,000 organizations Across multiple industries
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 16
• Executive support within the corporate cultureERM-based approach
• Integration into business processesERM process management
• Accountability within leadership and policy to guide decision-makingRisk appetite management
• Linking outcomes with their sourcesRoot cause discipline
• Analyzing and documenting risks and opportunitiesUncovering risks
• Executing vision, mission and strategy utilizing risk metricsPerformance management
• Integration into operational planning and executionBusiness resiliency and sustainability
RIMS Risk Maturity Model for ERMThe Seven Attributes
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 17
Common Elements from RIMS ReviewRIMS RMM ISO 31000 OCEG BS 31100 COSO FERMA SOLVENCY II
ERM-based Approach X X X X X X
Process Management X X X X X X
Risk Appetite Management X X X X X X
Root Cause Discipline X X X
Uncovering Risks X X X X X X
Performance Management X X X X X
Business Resiliency and Sustainability X X X X
Source: RIMS Executive Report: An Overview of Widely Used Risk Management Standards and Guidelines, 2011
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 18
Elements from RIMS RMM determine Your RMM Score
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 19
Silo’dActivities
Goals
Leverage risk-reward tradeoffs
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 20
ActivitiesGoals
Leverage risk-reward tradeoffs
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 21
TAKING THE RMM ASSESSMENTYou never fail until you stop trying. Albert Einstein
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 22
RIMS Risk Maturity Model
Begin from RIMS website
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 23
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 24
Getting started is easy!
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 25
ERM assessment (example)
Effectiveness
Proactivity
Coverage
Select a score for each of the 3 evaluation criteria
Evaluation criteria
Partially Ad Hoc
Somewhat Reactive
Partially Uncertain
Factor: Executive ERM support
Indicators
RIMS RMM indicators provide context for review
Select each of the 25 Factors
Completing the RMM assessment
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 26
RIMS Risk Maturity Model Structure
Attributes Seven core areas of ERM that drive effectiveness Compatible with various specialized frameworks
Risk competency measurement 25 factors and 68 indicators Objective evaluation criteria Key issues that differentiate maturity levels
Maturity levels Five maturity levels Detailed descriptions unique for each attribute Measure to help reach goals for improvement
Benchmarking Standing in peer group Highlights ERM trends and priorities
Leadership
Managed
Repeatable
Initial
Ad hoc
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 27
USING THE OUTPUTThe measure of intelligence is the ability to change. Albert Einstein
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 28
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 29
Assessment describes the
next level
Each attribute is assigned a
level
Based on Your Responses
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 30
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 31
Business Continuity
Vendor ManagementFinancial Reporting
ComplianceInformation Security
Compliance
Identify &Assess
ManageResponseOptions
Monitor
Business Process
Strategic Objectives
Business Results
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 32
A PROPOSITION
In the middle of difficulty lies opportunity.Albert Einstein
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 33
Let’s Make a Deal, Saskatchewan Chapter!
Each of you complete the RIMS Risk Maturity Model Assessment by December 20th.
We will provide you with an aggregate Chapter Benchmarking Report for your January meetingo Standing in peer group o Highlighting ERM trends and potential priorities in your area
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 34
Copyright 2012-2013 Risk and Insurance Management Society, Inc. 35
Contact Information
Carol Fox, ARMDirector of Strategic and Enterprise Risk Practice
RIMS+1 212.655.6004
Steve Minksy
CEO
LogicManager
+1 (617) 649-1321