In today’s globalized world, the need for risk management professionals is more critical than ever. Firms require expertise to handle risks and exposures, and a certified risk professional has a competitive advantage over others due to their unique set of skills such as risk management, ethics, and leadership. This article will guide you on how to carve out a career path to become a risk management specialist, understand what risk management is, what risk management professionals do, the career opportunities in the field, and how to obtain risk management certification.
Understanding Risk Management
Risk can be viewed as the combination of the probability of an event and the impact of its consequences. Events with a negative impact represent risks that can prevent value creation or erode existing value. Risk management is applied in strategy-setting and across the enterprise. It involves identifying potential events that may affect the entity, managing risk to be within its risk appetite, and providing reasonable assurance regarding the achievement of an entity’s objectives. Risk management involves control and prevention of adverse events which may lead to losses. This is required in a wide range of industries and organizations, giving a wide range of options for a career path. Risk management professionals ensure legal compliance and implementation of governance frameworks from regulatory bodies.
Enterprise Risk Management (ERM)
ERM is a new concept that revolutionizes the traditional approach and summarizes risk management as an integrated, comprehensive, and strategic system. It covers strategic planning, operations, processes, and financial risks.
The 5 Steps of Risk Management
- Risk Identification
- Risk Assessment
- Risk Evaluation
- Risk Mitigation
- Risk Monitoring
The Role of a Risk Manager
A risk manager establishes the firm’s risk appetite, identifies risks the business is exposed to, and manages those risks. They are involved in strategic planning and business operations, create business continuity plans to limit risks, and ensure legal compliance and implementation of governance frameworks from regulatory bodies.
Responsibilities of a Risk Manager
- Risk reporting
- Corporate governance
- Health and safety
- Conducting policy and compliance audits
- Designing and implementing the overall risk management process
Examples of Risk Management
- Commodity Price Risk
- Financial Risk
- Compliance Risk
Careers in Risk Management
Risk managers analyze and implement ways to prevent losses from occurring. To study for a risk management certification, you need an undergraduate degree preferably in risk management. However, an advanced degree in a quantitative discipline such as statistics, computer science for cybersecurity, and other disciplines are also eligible for risk management roles.
Job Titles in Risk Management
- Risk Analyst
- Insurance Analyst
- Loss Control Representative
- Risk Consultant
- Risk Control Consultant
- Risk Management Consultant
- Risk Manager
- Business Risk Manager
- Corporate Risk Manager
Obtaining a Risk Management Qualification
MANCOSA offers a Postgraduate Diploma in Risk Management that is fully accredited by the Council on Higher Education (CHE) and registered with the South African Qualifications Authority (SAQA). The programme is aimed at building advanced skills and knowledge in the field of risk management.
Study Risk Management with MANCOSA
If you are passionate about the business environment and the internal operations which affect the viability and profitability of a business, visit the MANCOSA page on the Postgraduate Diploma in Risk Management to find out how you can pursue a career in risk and develop your skills to meet global standards and governance frameworks.