The role of the Chief Risk Officer (CRO) has rapidly evolved in both scope and importance in the years since the financial crisis to now play a more centric role in shaping business strategy, according to a joint paper by the Lloyd’s Market Association’s (LMA) Chief Risk Officer Committee and the Korn Ferry Institute.
The shift from technical expert to business advisor has propelled CROs into a world of complex stakeholder relationships, business navigation and regulatory expectations.
Key competencies for CRO’s to develop requiring substantial effort from them and significant support from stakeholders are highlighted as “managing ambiguity and conflict, cultivating innovation and situational adaptability.”
Finding the next generation of talent will be a challenge to many firms, however, the report suggests that successful firms will be those that cultivate their CROs to act as core advisors to Chief Executive Officers (CEOs) in managing strategy and operation of the business.
Alex Hindson, Chair of the LMA CRO Committee and CRO, Argo Group, said; “Developing the risk management talent of the future and ensuring it is prepared to meet the threats and opportunities facing our industry is an important element of building the risk function of the future.
“This report is an important contributor to the evolving discussion regarding the nature of the Chief Risk Officer role and the personal qualities required to fulfil such a role in the insurance industry.”
