PwC argues that developing and integrating a robust Enterprise Risk Management (ERM) framework will lead to cost savings, more efficient allocation of resources and reduction in reputation risk exposures.
Bruce Scott, Risk Assurance Leader for PwC in the Caribbean says, “Companies that equip their line managers (i.e. the first line of defense) and staff with the tools and techniques to identify, assess and respond to risks in a proactive manner, will have a competitive edge. We know that major risk exposures are rarely confined to discrete areas in an organisation, but rather, can have a domino effect across the organisation. It is for this reason that PwC has developed a holistic approach to risk management to help protect businesses, facilitating strategic decision making and enhancing efficiency. Our teams have extensive experience having already worked with public and private sector clients of all sizes to understand and address an extensive range of strategic and operational risks”.
Mr. Scott was speaking Tuesday (April 24) at a Professional Ethics and Risk Management conference hosted by the Bahamas Institute of Chartered Accountants. He also presented in Freeport, Bahamas on day 2 of the conference. The objective of the conference was to improve the Risk Management capabilities of participants.
In his presentations, Mr. Scott also highlighted the importance and roles of the Three Lines of Defense in a business. The three lines of defense are:
- First line of defense (line managers) is responsible for day-to-day execution and management of risk and controls;
- Second line of defense provides support to the first line of defense and includes functions like risk management, quality and compliance; and
- Third line of defense is internal audit, which is responsible for independently testing that the company’s risks are being mitigated. The third line may also include external auditors and regulators.
Risk management teams led by Bruce Scott, have been making presentations at a number of conferences, training seminars and providing consultations across the region to increase and improve risk management knowledge and practices. The team has also performed extensive research on why organisations fail to properly identify, analyse and address business risks and has worked with a number of businesses regionally to provide cutting edge Enterprise Risk Management Services. The findings from the research has also resulted in the development of a regional Risk Management seminar series entitled “Better risk management, better business performance” hosted by PwC, to share risk management best practices and lessons learnt.