Troublesome times demand more effective practices

The intensifying financial pressures bearing down on the American government and taxpayers due to egregious corporate mismanagement will focus increasing and unprecedented scrutiny on the business world. The risk management community believes a paradigm shift is at hand. Organizations of every kind will feel pressure to do more than they have in the past to understand the risks they face, expose and challenge every assumption they make, and take steps to quantify and appropriately mitigate the exposures they identify. This will not be an easy transition. Just as the healthcare community has struggled over the past 25 years with the paradigm shift from the unsystematic clinical experience to a more analytical, evidence‐based approach, the corporate world will have to move from a traditional silo‐centric risk management system to a more formalized, analytical, enterprise‐wide risk management competency.