March 20, 2013

Risk SUMMIT Will Convene in Boston

The 2013 Risk SUMMIT will convene this August 25-27, 2013 in Boston, MA. Mark your calendar and plan to attend this annual gathering of nonprofit and insurance industry professionals dedicated to best-in-class risk management. We will bring back a few favorite features of past SUMMITS, and introduce a few others. Loyal attendee pricing and online booking at the conference venue will be available next week. In the meantime, we want to express our deep thanks for the companies that have already signed on as Corporate Sponsors of the conference. These generous sponsors include:

HCA Asset Management, LLC, 501c Agencies Trust, Tangram and ProSight Specialty Insurance, Great American Insurance Group, Canfield and NPIP, Charity First Insurance Services, Inc., First Nonprofit Foundation, Chubb Group of Insurance Companies, Munich Reinsurance America, Inc., Philadelphia Insurance Companies, Riverport Insurance Company, and Arthur J. Gallagher & Co. and our Group of Companies. If you are interested in joining the line-up of sponsors, contact Kay Nakamura, Director of Client Solutions at (202) 785-3891 or Kay@nonprofitrisk.org.

Risk Oversight: Who Dunnit?

By Erin Gloeckner

When I first heard the term ‘risk oversight,’ I imagined a risk manager following clues in a deerstalker hat like Sherlock Holmes. I thought ‘risk oversight’ meant chasing down the villain who allowed the risk to materialize. But risk oversight is not about blaming people when downside risks materialize. Those responsible for risk oversight don’t ask, “Who dunnit?” Instead, they ask, “What steps and practices are necessary to ensure that we recognize strategic and operational risks in a timely fashion?” They also ask, “What teams of people in this organization are in the best position to recognize and respond to a variety of risks we face?”

In a way, the practice of risk oversight reminds me of Sherlock and his partner, Watson. Just as Sherlock Holmes must be zealous in his search for the truth, nonprofit leaders must be fearless and vigilant while examining upside and downside risks. Watson approaches mystery with rationality. Like Watson, nonprofit leaders must provide a grounded perspective on how risk-taking and risk avoidance align with strategic goals. Every nonprofit's leadership needs a bit of both to provide thorough risk oversight.

Risk oversight is not a task assigned to your risk manager. The board of directors and the management team share responsibility for risk oversight. Multiple risk oversight perspectives are necessary to help influence risk taking that advances your mission. Ultimately, you want management and the board to have a shared vision of risk accountability and communicate that vision and structure to staff members. Management must decide which potential or existing strategic risk should be escalated to the board, and which operational risk remains the responsibility of management or staff.

Risk oversight is a form of nonprofit stewardship. Risk oversight empowers you to anticipate a range of outcomes when you embrace risk. Risk oversight helps you:

Forecast the range of upside and downside risks that could result from taking mission-related risks.

Align risk-taking with your core mission and strategic priorities.

Distribute accountability for decision-making in a world of uncertainty throughout your organization.

Ensure that appropriate action plans are ready to deploy when better or worse than expected outcomes occur.

When nonprofit leaders fail to provide risk oversight, the staff member wearing the “risk management” cap might go on the chase asking, “Who dunnit?” If you’d like to stop chasing the Hound of Baskervilles and build the institutional capacity to anticipate risk by engaging leaders at all levels of your organization, join us for a webinar on this topic, “Risk Oversight: Who, What, and How?” on April 3rd, 2013 at 2:00 pm EST.

Erin Gloeckner is Project Manager at the Nonprofit Risk Management Center, where she coordinates and supports consulting projects for a diverse array of clients. She’s also working on a brand-new book on managing partnership and fundraising risks. Erin welcomes your feedback on this article or questions about risk issues at erin@nonprofitrisk.org or (202) 785-3891.