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Failure in Risk Management: Climate Change

What do the power outages in Texas in 2021 and the ones in California in 2018 and 2019 have in common? Although the crises are different – one faced fire, the other an ice storm – in both cases, the power utility industries were negligent in risk management.

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The root causes of these power grid failures were known in advance by the employees of the responsible organizations, and were therefore 100% preventable. The overarching problem, however, is that these organizations are heavily siloed, and d

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                                                     A message from our partner:

 

Dear Global Risk Community member,

InsuranceERM’s 7th annual  Insurance Risk & Capital EMEA conference
takes place on 2 – 3 December at Hilton London Tower Bridge and a
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Attend to:

-  Meet over 400 delegates (70% of which are insurers and regulators)
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-  Hear from 60+ expert

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8028299277?profile=originalThe Internal Institute of Auditors (IIA) and ISACA held their 2019 Governance, Risk, and Control Conference from August 12th to 14th in Fort Lauderdale. This year I was honored to be selected to speak on the effects of data privacy risks in the See-Through Economy in my presentation, “Prepare for a Data Governance Revolution with a Risk-Based Approach.”

Each year, powerhouse risk governance associations ISACA and the IIA bring together the leaders of  the governance, risk, and control (GRC) indus

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The banking industry is perceived as the most advanced in their understanding and implementation of risk management. Although banks have indeed made huge progress in risk management, two areas all banks can improve is the structure used in conducting their assessments to enable actionable and insightful strategic reporting.

8028296299?profile=originalI’ve found that the understanding and implementation of risk management is driven not by industry or size of institution, but rather by its people: boards, executives, their t

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Cybersecurity vulnerabilities are an increasing concern for every company in every industry. Year over year, data breaches increase by 75%. Why are they becoming more prevalent, and how can you protect your business?

8028282501?profile=originalBefore you can protect your company from a data breach, you have to understand why they’re occurring. So let’s look at some statistics:

  • 81% of hacking-related breaches leveraged either stolen and/or weak passwords
  • 70% of employees reuse passwords at work
  • Ransomware is the top variety of
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For the first time, reputation risk, organizational culture, and cybersecurity have all landed among the top five risks in the energy industry. How can energy companies tackle all of these risks without wasting time and money on additional resources?

8028290497?profile=originalThis year at my IRMI Energy Risk and Insurance Conference session, I showed attendees how they could tackle all three of these top-priority risks with enterprise risk management.

The key is adopting a truly integrated approach to risk management. The

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8028290652?profile=original Even a $1 trillion company cannot hide in the See-Through Economy. After a fourteen-year-old boy discovered a serious bug in Apple’s group FaceTime feature, his mother e-mailed, faxed, and tweeted the report to Apple. However, it wasn’t until after her tweet went viral that the bug was disabled. How could Apple have responded more efficiently and avoided this reputational risk?
Most Apple users are familiar with FaceTime, Apple’s video chatting software. The feature had recently been upgraded, s
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How to Prepare for Recession Risk with ERM

8028278091?profile=originalToday the economy is strong and your business is doing well. But are you prepared for when this strength turns to weakness? Enterprise risk management has been proven to help companies survive a recession.

While there is much debate over whether a recession is looming or not, the fact is, you need to be prepared. Whether in 2019, 2020, or 2021, it’s not a question of “if,” it’s a question of “when” a recession will occur, as history has proven that fluctuations in the economy are both inevitable

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8028279865?profile=originalThere’s an undeniable shift occurring in the business world right now. In fact, it’s been forming since 2007. I’ve coined the phrase the See-Through Economy to encapsulate the shift towards transparency and accountability brought on by new technology and social media.

Since the invention of the smartphone in 2007, consumers have started to exercise their sharing power. Pocket-sized computers alongside world-wide social websites have empowered the everyday customer to influence the integrity of a

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Top ERM Blog Posts of 2018

8028277291?profile=originalScandals, predictions, and insights, oh my! We’ve covered a lot of ground this year in the risk management world. But what were the topics people were buzzing about most?

With over 50 blogs posted in 2018 alone, there was a lot to learn and even more you could have missed as the seasons whizzed by. So, we compiled the top ten blog posts of 2018 to help you refresh and catch up! In these ten ERM blogs, we covered everything from the best way to measure the effectiveness of your ERM program, all th

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8219689880?profile=originalLast Friday, Marriott disclosed that the data of about 500 million guests had been exposed as a result of a hack that dates all the way back to 2014.

In 2014, hackers exploited the reservation system of Starwood Hotels and Resorts, which was acquired by Marriott in 2016. The breach exposed user data that not only included names, phone numbers, email addresses, passport numbers, and dates of birth, but even access to some encrypted credit card data.

As a result of this breach, Marriott may be one o

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IMPACT 2018: Becoming a Risk Management Hero

On Nov. 29, the LogicManager community arrived at Hotel Commonwealth in the historic Fenway district of Boston for sold-out IMPACT 2018. Every year, LogicManager hosts a customer conference where users of the ERM software can learn, share, and grow their risk management program to full maturity.

    

Upon walking into the conference space, you could feel the partnership LogicManager strives to create between customer and employee. As a SaaS provider, most of our work is virtual. But at IMPACT, it

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In late September, Facebook announced that it had discovered a breach in its network that had exposed the personal data of nearly 50 million users to hackers.

The hackers exploited a feature in Facebook’s code to gain access to user accounts, potentially enabling them to take control of them. The breach was the largest in Facebook’s fourteen years of existence.

The fallout Facebook is facing from this breach is the latest example of the see-through economy at work. Since September 27, Facebook’s m

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The Society of Corporate Compliance and Ethics (SCCE) held their annual Ethics and Compliance conference from September 20 to 24 in Las Vegas. This year, I was fortunate enough to be selected to hold a three-hour workshop on risk-based compliance: “Meeting Increased Customer Expectations, Not Just Regulatory Requirements.”

 

8028278069?profile=originalThe SCCE holds this conference to promote ethical and compliant practices in organizations and to equip ethics and compliance professionals with skills and tools necessary to

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8028276478?profile=originalUber has agreed to pay a hefty $148 million settlement after concealing a data breach in 2016 containing 57 million users’ data. In hopes of preventing this from recurring, it’s time for Uber to reassess their risk management practices, and in turn regain the public’s trust as well. 

Although this regulatory problem has resulted in a huge sum of money, this is not the greatest consequence Uber will face due to a risk management failure. The hit on Uber’s reputation is massive. The concept I call

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8028274053?profile=originalWe’d like to congratulate the 25% of US-based companies that achieved GDPR compliance by the May 25th deadline, and to share a little guidance on how to stay compliant over time.

As we all know, the GDPR is a huge deal. In addition to the scope of this new regulation, there’s also the consequences of non-compliance, i.e. up to €20 million or 4% of annual global revenue, whichever is higher.

Aside from incurring steep fines and lofty litigation, the risk of non-compliance also includes losing your

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8028278090?profile=originalEmergency situations like natural disasters, data breaches, fraud, and the like arise, by definition, without warning, leaving you little to no time to prepare. So how do you build a BCDR plan that is flexible to handle any situation and is always up to date without huge investments?

The hallmark of a successful BCDR program is leveraging the information you already have to discover the potential impact and remediation tactics for an anticipated disaster. So, if you’re collecting information arou

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It’s been a rough two years for Wells Fargo.

Ever since the existence of the bank’s massive cross-selling scandal came to light in 2016, Wells Fargo seemed to be trapped in a downward spiral of failure after failure in risk management. In 2016, we were the first to identify the root-cause of the cross-selling scandal as being a failed risk management program, and correctly predicted there would be more Wells Fargo risk management mishaps in the future.

In 2018, regulator investigations finally con

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To run an effective ERM program, you need the right metrics.

Risk professionals today are facing an unprecedented level of scrutiny. Risk managers are not only responsible for protecting and securing their organizations, they also have to provide evidence that their risk management programs are actually effective at managing risk.

At the very minimum, risk managers must prove they are meeting the expectations of not only regulators, examiners, and their board of directors, but also their customers

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8028274101?profile=originalSince 2015, Chipotle has suffered multiple scandals of food-borne illness. The latest Chipotle outbreak has left more than 700 people ill. What does the Mexican grill have yet to learn?

In my last blog, “Hey, Chipotle, Can You Say Risk Management Rehab?” I took a look at the company’s timeline, and more specifically asked the question as to whether changing their CEO structure twice in less than two years was really the answer to their spicy woes.

This latest Chipotle outbreak, which has been ongo

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