An Introduction to Risk Management

An introduction to the concepts, theories and systems involved in modern day risk management methodologies, giving you a broad grasp and introduction to this intensive Certification Program.

• What is risk and why worry about it?
• What are the key risk types?
• The evolution of risk management thinking
• Risk principles
• Overview of current and future risk management issues
• Enterprise wide risk management
• Integrated and holistic risk management principles
• Application and implementation within an organization
• The risk culture versus the risk process.

Exercise – Risk Register

This section will introduce you to the concept of risk identification and the construction techniques for the establishment of a risk register. The risk register is the fundamental building block for risk identification process and the eventual management of risk within an organization.

Module Two discusses and practices the significant risk issues identified during Module One. This section allows you to identify and discuss the major risk categories facing businesses today. In addition, the Certification Program leader will introduce you to various tools and techniques that allow for the identification and management of risk. You will develop a toolkit based on simulations and tool sets which will help you in evaluating risk and effectively determining risk strategies.

Risk Exposures and Major Categories

Correct risk management requires an iterative process that allows for the identification of exposures within a corporate setting. The process must be rigorous and subject to review. The key task in the process is the contextualization of the risks faced and implementation of protective measures to ensure resilience within an organization.

Categories of Risk

• Market risk management and market influences
• Liquidity and volatility
• Interest rates
• Foreign exchange
• Operational risk
• Liquidity risk
• Solvency risk.

 Tools For Identification And Management

• Value at Risk (VaR) – calculation and use
• The concept of hedging
• Use of synthetics and markets
• Portfolio management as a risk tool
• Stress testing
• Risk models discussion and overview

Exercise

You will examine and comment on case studies to enhance your ability to identify risk and develop appropriate strategies. Individual and group exercises will be practiced.

Operational Risk Management

What is operational risk and how can your business monitor and protect itself from this risk? How do we capture data from across the enterprise to identify these internally focused risks?

• Basel and the development of operational risk
• The three pillars of management
• Capital allocation for operational risk management techniques
• Capital allocation models
• Monitoring operational risk
• Quantifying operational risk
• Data issues and knowledge management.

Exercise

You will examine and comment on case studies to enhance your ability to identify risk and develop appropriate strategies.

• The families of risk
• Strategic versus operational, versus tactical risk
• Understanding and applying risk management within your organization
• Political And Sovereign Risk
• What are these risks and how do they manifest?
• Why monitor this risk?
• Measuring political and sovereign risk
• Practical effects of political and sovereign risk
• International implications of risk management

Risk Linkages and Value Added

• Broad corporate, enterprise and market risk factors that impact operations, governance and compliance requirements
• Business continuity management
• Quality management
• Corporate governance

Identifying and Implementing Risk Standards

Do you truly understand your organization’s risk profile? To protect your organization from risk is one issue. Finding a balance between being risk-averse – which can materially constrain your operation versus being so high risk that you expose your organization to potentially devastating scenarios, is quite another!

• Risk, reward and regret
• The gulf between data and wisdom
• Review of world standards – UK – Europe – USA – Other global standards

Exercise

You will examine and comment on a case study presented within a structured setting and solutions will be offered.

The final module encompasses issues from the four previous modules into a workshop learning model. You will finalize your model risk register and toolkit.

Practical Assessment Exercises

Tasks will be issued on an individual and team basis that will confirm your skills and ability to apply risk management techniques. Exercises will consist of team discussion of case studies and individual comments on practical risk problems. Successful completion of this phase will comply with the