ACCA report says that accountants have an important role in enterprise risk management
- Published: Tuesday, 13 July 2021 08:25
ACCA (the Association of Chartered Certified Accountants) has published a new report, ‘Rethinking Risk for the Future’, which looks at ‘the unique role of the accounting profession in effective risk management’.
ACCA asserts that as guardians of information, accountants can help organizations not only detect and better understand the emerging risks and opportunities facing them, but also cultivate the mindsets needed to think more long-term. Capturing the views of ACCA's global members, the report showcases their vital roles in building organizational resilience through enterprise risk management (ERM), financial reporting, and data analysis.
The report explains that while COVID-19 is the biggest crisis in a generation, business and society also face huge risks from rapid climate change – perhaps the biggest risk of all. Risk management has therefore been forced center / centre stage like never before. Accountants now have an unmissable opportunity to reassess how they can add more value in a post-COVID world where myriad environmental, social and economic risks will be prevalent.
"What's clear from the roundtables we held with ACCA members is the need for accountants to truly understand the strategic and business risks that their organizations face in the short, medium and long term," said Rachael Johnson, report author and ACCA's head of risk management and corporate governance. "In this way, they can help maintain operational resilience in today's fast-changing, interconnected environment."
"This year, the pandemic required us all to learn new and vital lessons about effective risk management, and disruption preparedness is now top of organizations' priority list," said Jillian Couse, head of ACCA North America. "The challenge is now about how this readiness is sustained by organizations in the face of other crises, including climate change, creating an opportunity for the accounting profession to show its value in rethinking risk."
ACCA believes that accountants should be taking on a more advisory role in explaining the facts and possibilities behind the numbers, breaking them down and putting them into context for their organizations. The current environment creates an opportunity for accountancy to encourage more collaboration and collective action on environmental, social and governance matters by working with public policymakers and partnering with leaders to help grasp how digitalization and new technologies can help avoid harm to people and the planet.