How to Create an Effective Risk Management Committee Report
This tea-talk attracted a full house of participants from various industries and sectors. The speaker started the session by enquiring into the challenges that participants faced when preparing a risk management committee report and then proceeded to discuss and recommend various steps and guidelines to addresses those challenges.
The first step to writing an effective Risk Management Committee Report is to understand and be clear about the purpose or intent of the report. For example, is it a review report or is it a risk opinion?
At the same time, it is important understand who the audience is. A point to note here is that the risk manager needs to be clear about what the board risk management committee (BRMC) wants to see. If the risk manager is unsure, it would be advisable to ask the BRMC – this also address the issue of “at what level should the report be pitched?” Hence, the report writing style may have to change whenever the board composition changes.
By matching the purpose of the report to the reader, you are ready to set your report objectives. In other words, what do you want the reader to think and do after reading your report. The objective must be clearly addressed either in the conclusion or recommendation.
Mr. Pillai highlighted that from his experience as a board director, there is normally too much data and little or no analysis in the report. He recommends that the report should begin with an executive summary to provide context. The risk manager should only present these 5 to 6 pages for discussion. It is also important to think through and layout the flow of your thoughts and information upon completion of the report for further refinement.
It is important to note that, in relation to approval papers, the risk assessment / risk analysis section of the report should be prepared by the line. Risk management department’s role is to review and challenge the assessment and sign off with relevant comment if the independent risk management review has conflicting, differing or additional opinion which would support the effectiveness and quality of the decision making process. Risk managers should also arrange the sequence of the discussion points based on their criticality.
Other techniques discussed included using simple language when writing the report and always seeking feedback for future improvement. The speaker also suggested other simple techniques such as varying the fonts to highlight the points that they want to emphasize. Risk managers are also encouraged to brief the Chairman prior to the meeting as part of the preparation for an effective meeting.