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RIMS ERM Conference 2021: A Case-Study Approach to “Solve Any DEI Issue in One Hour”

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At today’s RIMS ERM Conference 2021, a hybrid event with in-person experiences in New York City and virtual content online, many of the presenters focused on the intersection of ERM (enterprise risk management) with other mission-critical three-letter topics, including ESG (environmental, social and governance) and DEI (diversity, equity and inclusion).

In one of the afternoon’s sessions, “Identify and Solve Any Organizational DEI Issue In One Hour,” presenter Layne Kertamus, professional in residence of risk management and insurance at Utah Valley University, explored “new ways to talk about what needs to be said, and what needs to be listened to.”

“Most organizations that I’m aware of have moved past the idea that they have to do something on [DEI] issues for our stakeholders—it has moved on to ‘We cannot afford to not have some real results in these arenas’ and that should be motivation enough, if we needed any motivation,” Kertamus said. “The issue will not go away and it will evolve. Hopefully we can find a way to make this not just a prompt for change, but a real asset.”

Kertamus noted the particular challenges of the “frozen middle” in implementing meaningful DEI initiatives. Middle management feels pressure from both above and below to take DEI action, and “may react to hearing these goals with concern or dread—for example, thinking ‘My status and opportunities may now be more limited than they were before.’”

With the “why” and other background largely established, Kertamus focused the session on one approach to the “how” of DEI-related change. While many DEI discussions start with general open forums and reminders about being respectful and open, he noted that some of these approaches may lead to inauthentic or surface-level outcomes. To really get into an authentic plan that gains acceptance, Kertamus said, “sometimes we need to create environments where we can talk the way we need to talk.”

He proposed that organizations adopt a case study method to facilitate some of these discussions, outlining the “one hour” from his session’s title:

  • With this method, a “case presenter” brings their concern, challenge or passion to present a large-scale DEI-related issue in the workplace that impacts other stakeholders. A facilitator should be selected and need not be an expert, but must bring an open mind and a willingness to enforce time limits. A group of “peer consultants” is then gathered from across the company, perhaps at different levels or in different departments.
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  • First, the group listens to a five minute presentation from the case presenter, and then spends 10 minutes asking fact-based questions directed through the facilitator.
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    It is critical that the questions are directed and perhaps even pointed, but be focused on facts and not opinions or defenses.
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  • The largest segment of the process is a group diagnostic session, spending 20 minutes examining what, if anything, the presenter may have left out, may have ignored as a result of their own lived experience, or other gaps in the issue. It is critical not to jump to solutions in this phase—you may get “answers,” but the purpose here is true diagnosis.
  • The next 10 minutes should be spent on group action brainstorming, brainstorming solutions for the presenter, embracing all perspectives and bringing personal experience, values, and insight to the table. “Be willing to give the presenter bad news, if necessary,” Kertamus urged. For example, you may need to acknowledge that there is no solution, or that they missed a strategic opportunity along the way. The presenter should remain quiet and listen during this step.
  • Next, the presenter gets 10 minutes to respond to the discussion, speaking candidly and asking questions after listening to the group’s brainstorming session. “This can be a defensive time, they may feel beat up, but it can also be an opportunity for real connection, understanding, and for making agreements and commitments moving forward,” he said.
  • If agreements are made, one question is critical before adjourning: “When will you move forward using action steps recommended today?” This can be a critical moment in advancing concrete plans and changes in attitude or approach to DEI in the workplace.

While this approach can be used with a wide range of issues as the focus “case,” Kertamus noted it is particularly useful with “problems where someone cannot just use their authority to impose a change or solution,” for example, a leader who has tried to implement changes and build equity and inclusion as values in a department but keeps meeting resistance. “This is really for instances where you accept the mission of the organization and want to make it real or palpable, but cannot just impose it, you need to open other dialogues,” he said.

If you are not attending the RIMS ERM Conference 2021 live this week, “Identify and Solve Any Organizational DEI Issue In One Hour” and other sessions from the event will be available to stream online during the event or later on-demand.

RIMS ERM Conference Preview: Q&A with Keynote Dr. Andrea Bonime-Blanc

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This year’s RIMS ERM Conference will be held virtually on November 4 and 5, 2020, promising two days packed with informative sessions featuring global risk leaders. The conference kicks off November 4th with a live keynote delivered by Dr. Andrea Bonime-Blanc, founder of GEC Risk Advisory and the author of Gloom to Boom: How Leaders Transform Risk Into Resilience and Value. She will also answer questions from the audience during a live session on November 5th.

Andrea Bonime-Blanc

Dr. Bonime-Blanc recently appeared on RIMScast to discuss her upcoming keynote; the role technology has played in environmental, social and governance risks (ESG); and what risk practitioners must do to succeed today. Check out some highlights below, and download RIMScast episodes 100 and 101 for a deeper dive with Dr. Bonime-Blanc into topics such as diversity, strategic risk management and ways ERM practitioners can generate and retain value. If you’d like to watch her keynote and join RIMS for the rest of the ERM Conference 2020, registration is now open for all attendees.

How did you first begin using and implementing ERM in your career?

Dr. Andrea Bonime-Blanc: I was the general counsel of a startup within a much larger utility company, and we were the global division that was going all over the world in the mid- to late-1990s and early 2000s looking for electric power generation distribution opportunities. I became the risk manager because…[someone] needed to put the risk hat on. We ended up creating programs, policies, procedures to really perform risk management. Building power plants in the middle of the jungle of Colombia or negotiating a joint venture with a Chinese government corporation running a coal mine in northern China presents a number of risks.

When did you notice how vital it was to “wear the risk hat”? 

AB-B: I’ll give you the example of an environmental, health and safety risk: When I was at PSEG, we went into a lot of different countries, including at least six or seven major Latin American countries that were privatizing their electric assets. There were competitions to acquire those assets in the first place, which created a whole bunch of risks from a standpoint of fraud and government corruption. I supervised the legal teams, and also led audit and finance teams. We had utility folks who understood the environmental, health and safety aspects of the assets we were looking at. There were cross-functional and cross-disciplinary teams that would work with the legal department and the general counsel’s office to figure out the risks involved with acquiring those potential assets. It showed how ERM done properly provides that way of collating and collecting really important, strategic information that is necessary at the highest levels of an organization.

How can diversity—of people and perspective—influence ERM in an organization?

AB-B: ERM is a collaborative process. It requires many different minds. A good ERM program will draw upon the knowledge of other key people and functions within an organization. If it’s a standalone program, it won’t work. Drawing on the knowledge and expertise and experience of your colleagues in different parts of the organization is crucial. Likewise, ESG plus T is all about understanding your non-financial issues as well as the risks that will have a financial impact.

You noted the addition of “T,” which stands for “technology”—why is technology so integral to ERM now, and how does it tie into your keynote?

AB-B: The technology piece has become so overwhelming, so suffusing, so minute-by-minute for us in the world that we live in—whether it’s negative like cyberattacks, or positive things, and there are so many other issues in between. We’re just starting to scratch the surface of both the negative and the positive in these technology issues.

Risk professionals have a role to play in creating the information that reaches the management and the board, and building a risk savvy culture. This includes building ERM that is integrated with the strategy of understanding the ESG+T issues that are part of your business, and how you integrate with crisis management and business continuity, for example. These are all pieces of the resilience model that I will share at the end of the keynote. It is something that risk professionals really need to understand, because it not only liberates you from your silo—if you’re in a silo—but it also demonstrates your value to the rest of the organization.

RIMS ERM Conference: A Q&A on the Future of ERM

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What does the future hold for enterprise risk management? That’s exactly what a panel Q&A session touched on during the recent RIMS ERM Conference. Carol Fox, director of strategic and enterprise risk practice for RIMS, moderated the discussion between attendees and:

  • Ryan Egerdahl, risk manager at Bonneville Power
  • Mary Gardner, chief risk officer at Zurich North America
  • Rob Torok, risk management consultant with IBM Global Services

To kick off the discussion, Fox asked the panelists what the biggest changes in ERM were within the last 10 years?

Mary: A really big issue is going to be risk based capital. Where do we require it and where are we going to reduce our investment so we can write insurance in growing areas of the world. We want to reduce our risk so we can free up our risk capital so we can go into growing areas such as BRIC nations.

Question: Have you spent much time talking aobut enterprise content management, like records management, which I’m hearing more and more about?

Rob: One of the things we’re rigorous about is information security, with both internal data and the data that belongs to our customers and our clients. We have an enourmous amount of customer data. Because of that, there are an enourmous amount of controls IBM has put into place.

Mary: It’s an emerging risk. In fact, On October 13th the SEC indicated that all companies will be required to provide information on past breaches and what they might expect in future breaches and what impact that may have on their financial statement. That’s scary and we need to figure out what that means. It’s something to definitely consider.

Question: Having a risk taxonomy — is that effective? Does it help you manage risks? By separating them into various categories?

Mary: I would say yes. We identify risks in each business division and analyze them. It’s kind of a top down, bottom up approach. We look at the different kinds of inputs. We also use that to determine systemic risks and see where we have risks concentrated in one particular area or business.

Rob: An organization must have a standard risk taxonomy. Everybody in the organization must look at those risks and talk about how those risks affect each particular business unit. We’ve developed a template of about 150 risks. That template is a fine starting point, but don’t use IBM’s or any other company’s template — it won’t apply to you.

A client gave me a list of 504 risks and asked me to comment on it. The reason they had 504 risks was because many risks were repeated in each business unit and geography. This is because they never had a standard taxonomy. That list could’ve dropped by 40 or 50% easily if they had a standard language or taxonomy.

Mary: Companies need to think of their standard taxonomy as a living document.

Question: What do you do to help identify emerging risks?

Ryan: I’m less concerned about the unknowables. i’m concentrating on the big risks facing us now. we have enough to worry about right now in our business alone.

Rob: I haven’t got a clue what that next risk is, but allow yourself to think broadly about it.Ddon’t close your eyes to things. Don’t shoot down ideas of someone who says “hey, what about this or what about that?”

Mary: Keep it simple. We can make this ERM process so complicated sometimes. Maybe if we just get back to basics it would be much better.

Ryan: If you’re just starting the ERM journey, don’t rush into the GRC software immediately — wait until you’re mature enough in the process to get there.

Mary: Get out of the box. There are  a lot of conversations that may spur thoughts. Talking to risk managers in other industries may spark ideas.

Rob: What about your business and social network? What are they worried about? I’m not talking about things that have already occurred, but what has not happened yet in their enterprises. Use that information to help you think about risks in your own enterprise.

 

RIMS ERM Conference Awards Excellence in the Field

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The final day of the RIMS ERM Conference in San Diego was highlighted by the first-ever ERM Award of Distinction Luncheon, at which two people within the industry were honored for their innovative ERM programs that have demonstrated, with measurable value to their organization, enterprise risk management success. Essentially, the award was created to honor organizations that have shown tremendous committment to the ERM discipline. The criteria that the judging panel took into consideration included:

  • The scope of the ERM program and how it engages different levels throughout the organization
  • Its link or connection to the company’s overall mission
  • Its ability to create additional value for the organization

Honorable mention for the ERM Award of Distinction went to Goodwill Industries International. With the assistance of Deloitte’s Governance, Risk & Regulatory Services team and as as part of its national pro bono program, Goodwill developed an ERM program template to help member agencies improve their risk management practices. With a template in place, Goodwill was able to provide valuable guidelines to its members, that in-turn has helped protect one of the organization’s most vital assets — its name.

“This is a remarkable story and great example of how an ERM program can protect against reputational risks in a decentralized management structure,” Seaman said.

Jacqueline Fifield of Deloitte accepted the award on behalf of Goodwill.

The big winner of the 2011 ERM Award of Distinction was Paychex, Inc., a company that implemented an ERM program to add value throughout the entire organization, making sure its scope went beyond traditional risk oversight. As Seaman noted, “value creation was the focus of Paychex’s ERM program, and it certainly hit the mark. This is an exceptional example of an ERM program that set out to uncover opportunities for the company to reinvent itself, and it was directly responsible for generating significant revenue.”

Accepting the award was Allan Smith of Paychex, Inc.

Nowell Seaman, Jacqueline Fifield, Allan Smith and Mary Roth at the ERM Award of Distinction Luncheon.