Organizations should prioritise the ‘digital fitness’ of risk management functions
- Published: Friday, 05 April 2019 08:40
Organizations should focus on developing stronger digital skills and capacity in their risk function in order to make more informed decisions about risk in a technology-driven world, according to the eighth edition of PwC's Risk In Review study.
The 2019 study has found that while many organizations have already embraced new technology as part of their internal audit, risk and compliance functions they are yet to fully realise the potential benefits of using the insights to inform decisions over investment in digital transformation.
PwC's study focuses on identifying what categories help top-performing 'digitally fit' risk functions stand out both in terms of their ability to strategically advise stakeholders on risk and assurance, as well as the risk function's own ability to adapt and embed new processes required by digital transformation.
According to PwC the six habits of risk functions that fuel smarter risk-taking are:
- Go all-in on the organization's digital plan;
- Upskill and inject new talent to move at the speed of the organization;
- Find the right fit for emerging technologies;
- Enable the organization to act on risks in real time;
- Actively engage decision makers of key digital initiatives;
- Collaborate and align to provide a consolidated view of risks.
PwC surveyed more than 2,000 CEOs, senior executives, board members, and professionals in risk management, compliance and internal audit, and interviewed dozens of executives and board members to explore what differentiates risk functions when it comes to digital transformation.
The study identifies the key components of an organization's 'digital fitness' as:
1. Having in place the skills and competencies to strategically advise stakeholders on risk and provide assurance over the organization's digital initiatives.
2. Changing the risk function's own processes, tools, and services so they're more data driven and digitally enabled to anticipate risk events and respond to them at the pace and scale the organization's digital transformation requires.