 Authored by: Christelle Marais, Executive Director - Lucidum Consulting. The Institute of Risk Management South Africa member.
It was with a confusing combination of anger, sadness, guilt and frustration that I completed my reading of Pieter-Louis Myburgh’s ‘Gangster State’ recently: Anger – about the disrespectful arrogance with which the dreams of millions were stolen, while they trustingly looked on. Sadness – over the blood, sweat and tears that made this country, the blood, sweat and tears that built a new society after 1994 and the blood, sweat and tears that will rebuild it again, after the capture. Guilt – like many of my risk management colleagues, wondering if we could have done more to prevent the rot (causes) or to uncover what was going on (consequences) as part of our risk management effort in public and private organisations (because as ‘Gangster State’ suggests: it takes two to tango!). And then – frustration… Ah, maybe my frustration weighs heaviest on my heart… But frustration of the kind that would do it all over again, if someone would just listen, if someone would just take me seriously. While reading ‘Gangster State’ I was reminded of whistle-blower Harry Markopolos’ book ‘No One Would Listen’ about his investigation into the Madoff investment scandal and how the US Securities and Exchange Commission failed to heed his warnings. I was struck deeply by many who warned about what was happening in the Free State, such as Patrick Lekota, who’s highlighting of concerns went ignored (at best) and purposely thwarted (at worst); the Goldhawk report, with scathing findings on irregular loans; the Auditor-General, with many reports on the lack of financial controls and disregard for legislative compliance; Beatrice Marshoff, trying to appoint MECs that could do the job, but instructed to appoint Ace Magashule; and Noby Ngombane, whose efforts to implement oversight of Free State municipalities’ spending may have cost him his life. While I found the disregard for these warnings alarming, they awoke in me more familiar feelings: feelings that most risk managers would know all too well… Irritation when risk management is treated as ‘compliance’ only. Disappointment at not being taken seriously when including real risks in my reports, when pointing out real causes of those risks and when showing real consequences if those risks were to materialise. Disempowerment when the accountabilities that my risk management framework seeks to ensure, are negated and not keeping organisational role players to account, are rationalised. Despair when my risk reports are changed, redacted, reduced (or worse, just not submitted) because they include things that would make my leadership uncomfortable. Marginalisation when I realise that I am purposely excluded from key discussions, because my reason for existence in my organisation may expose things that would rather be kept hidden. Dismay if there is no effort by my leadership to understand what ‘risk appetite’ is and how the continued disregard of the impact of wrong decisions can destroy us. But most of all, exasperation when my reports are ‘NOTED’ by my governing body only to be regarded as having failed to convey the message, when things go wrong. As I read, I wondered what Madiba and Thabo Mbeki would say about the fact that they wished away the warnings, tip-toed around the issues and bowed to public and party pressures (diplomatically trying to keep a fragile governing system stable, but creating huge future problems for many people, not least of which is the legitimacy of government). I reflected back on minister Pravin Gordhan’s question at IRMSA’s 2018 Conference to risk managers: ‘How did you miss state capture?’ And I felt like asking: ‘How did you not hear us when we spoke out?’ Perhaps my message today is not so much to risk managers, as it is to leaders in all spheres of our economy (public, private, non-profit organisations, and civil society); to these executives, directors, society leaders, political heads and parliament, please
ENDS MEDIA CONTACT: Rosa-Mari, 060 995 6277, [email protected], www.atthatpoint.co.za For more information on IRMSA please visit: Website: https://www.irmsa.org.za/ Twitter: https://twitter.com/IRMSAInsight Facebook: https://www.facebook.com/IRMSAInsight/?ref=hl LinkedIn: https://www.linkedin.com/company/irmsa-institute-of-risk-management-sa/
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 Now that the elections are over, it’s time for government - every South African, in fact - to consider how to help the nation recover from its past woes and once again pursue progress and development.
The answer, says Christopher Palm, Chief Risk Advisor at the Institute of Risk Management South Africa, is right in front of us. Every system must maintain an upward trend in development to survive. This is true whether discussing a business, national government, the electrical infrastructure, the national economy, or the global environment. If it doesn’t, the inevitable shocks and stresses it faces in its operating environment can lead to a long-term downturn in development, ultimately resulting in the demise of the system itself. “To protect its progress and therefore its existence, each system must acquire the resilience to repel or recover from external threats,” says Palm. What is resilience? Technically, resilience is the rapidity with which a system can bounce back from sudden shock or sustained stresses to resume progressing its development at its normal pace. Practically, it means striving to create sustainable development in modern macroeconomic and microeconomic environments marked by change, risk and uncertainty. However, research indicates that any system that effectively manages risk is likely to become more resilient. “In fact, risk management can be considered successful only to the degree it results in resilience,” says Palm. Building resilience According to Palm, resilience starts with a mindset that is organised around risk management. That mindset, he asserts, is based on the realisation that, as maintainers of a system, we can either react to each crisis individually without actually preventing it from progressively eroding development. Or we can anticipate probable threats and implement countermeasures to minimize their impact ahead of time, and so conserve developmental gains. “Unfortunately, sustained exposure to system shocks and stresses can cause us to accept its degraded performance as the new normal,” warns Palm. “So we first need to foster an uncompromising mental resilience that drives us to return the system rapidly to its former best standard.” When all system maintainers are of the same mind, adhering to accepted behaviours and values, a culture of resilience is created that ensures a high level of development progress is achieved. But how does one nurture a resilient mindset? The resilient risk manager Both systemic and mental resilience are achieved by training members of the system in risk management to a professional level. Organisations who maintain the development of a system need highly qualified people who will implement the right policies and processes. Such qualifications will help it bolster resilience by building a robust risk management function, establishing comprehensive business continuity plans and disaster management plans, gaining the ability to correctly test the effectiveness of those plans, expanding its situational awareness through scenario planning and strategic reviews, and, finally, aligning its business processes to its risk management strategy. In essence, qualified risk practitioners are credible advisors who have the capabilities to protect system development and influence other members to strive for that purpose. “Once that self-organising culture is established,” says Palm, “we can not only preserve the progress of the system’s development, but also capitalize on future opportunities that would otherwise have been missed to make even faster gains.” Palm encourages all organisations to ensure they have a well-trained risk management team who are accredited members of a professional risk management body. ENDS MEDIA CONTACT: Rosa-Mari, 060 995 6277, [email protected], www.atthatpoint.co.za For more information on IRMSA please visit: Website: https://www.irmsa.org.za/ Twitter: https://twitter.com/IRMSAInsight Facebook: https://www.facebook.com/IRMSAInsight/?ref=hl LinkedIn: https://www.linkedin.com/company/irmsa-institute-of-risk-management-sa/ |
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