“Risk management” deemed vital to corporate governance

CEBU, Philippines- Cebu Business Club president Gordon Allan “Dondi” Joseph shared a piece of advice for the local business community on preparing against the growing risks faced by businesses nowadays.

"Risk management is integral to corporate governance. Calamities are our 'new normal'," said Joseph expressing disappointment that most companies, including the government authorities are not serious in putting in place a good risk management system in their respective organizations.

There are a lot of kinds of risks that business and public sectors should identify clearly, these are among others, operational, financial, strategic, hazard, calamity risks.

In strategic risk for instance, companies are told to be on their toes all the time, as the onset of ASEAN opens up the market to bigger companies taking advantage of the Philippines' appetizing market.

"Companies in the ASEAN are stepping into the Philippines. They are hiring good people, sharing our market," Joseph said emphasizing that local players' control is to set up good strategies that will protect their companies from being swallowed by the giants.

He said companies should understand that while the entire environment has changed, risk or uncertainties have become the core concern.

There is an actual science that identifies the risks of business, and how to deal with its dynamism.

"There is a whole host of methodologies available in how to face and deal with 'what if' scenarios," Joseph said explaining further that examples of risk protection include: insurance, ISO 31000 : 2009 or "Risk Management System."

According to Joseph, a lot of Cebuano companies, even the local government have risk protection system for granted, and that this poses a threat to Cebu, especially in times of calamities.  (FREEMAN)