The evolving risk landscape

Nurturing a healthy risk culture

What is risk? Organizational risk generally includes the many things that will lead to an undesirable outcome or impede an organization from achieving its strategic objectives. This includes the risk of not identifying opportunities to grow a company or further an organization’s mission.

Companies and organizations face a variety of risks. Some are unique to a particular sector or industry; some are more universal. Over the past year, as Baker Tilly professionals worked with their clients, certain risks were mentioned more than others:

• Finding and retaining the right talent
• Dealing with an increasing variety cybersecurity events
• Mitigating supply chain gaps and delays
• Identifying environmental, social and governance (ESG) standards
• Preparing for one-of-a-kind black swan events

When a company is focused on running the business, catering to customers, or serving the needs of clients or constituents, building an effective risk culture isn’t easy. However, a strong culture can be built over time, when inspired and nurtured by effective leadership.

Ultimately, having a strong risk culture means that management and employees know what the organization stands for and the boundaries in which individuals can operate. In a healthy risk culture, the board, senior leaders, managers and employees will be empowered to discuss and debate openly which risks should be taken in order to achieve the company's long term strategic goals.