According to recent Deloitte findings the top three risks identified for Indian corporates in the next three years are cybersecurity, technology disruptions and regulatory risks. The report added that there exists a divide on the viewpoint of risk management amongst Indian organizations.
The research termed as ‘Deloitte India Risk Survey 2018,’ finds 44 % of businesses harness risks to find future opportunities and drive returns, while 36 % to use risk management with an aim to drive compliance and prevent losses. This insight further gets substantiated with the fact that Regulatory Risk (44%) still leads amongst the top 3 risk areas in India followed by Cyber Security (31%) and Technology Disruptions (25%). The core reason for this trend is the fact that CXOs are considering regulatory compliance as a critical value protector exercise. The survey was conducted among over 100 top senior executives such as chief executive officers, chief financial officers, chief risk officers, business leaders and heads of internal audit.
“The changing trend demonstrates that with digital transformation, organisations will now need to redefine strategies as they become susceptible to multiple threats emerging through technology disruption. While there are no surprises on the top 3 risks, we believe that the volatility and complexity of each of these risk will continue to increase. This essentially means that there needs to be a shift from being risk averse to risk aware, with the power of innovation”, said Rohit Mahajan, President, Risk Advisory, Deloitte India.
The responses have been gathered from organisations belonging to a diverse set of industries that include both private companies and public companies with turnover ranging from less than Rs. 500 crores to Rs.7500 crores.
The key finding of the report for Indian Cos are:
Risk and opportunity – a duality
Right-skill the function
Use technology to enable the risk function
The survey result indicated that only 35% of the organisations had a high involvement of Board of Directors in Risk management. Acquiring and nurturing risk talent is an area of challenge for most businesses. 34% of the organisations surveyed had not reskilled their risk management team or moved personnel from business units into the risk management function to deal with the complex and rapidly changing business environment. The survey further suggested that 12 % of the organisations did not have a well-defined risk management strategy and 27 % of the organisations were unsure of their risk management strategy.