We are all too likely to ignore the obvious things in front of
us,
we always look at risk grey rhinos and Black Swans, but you
know, they may be potential areas that we have not looked
into as well. So and that is a risk,
the whole point of the grey Rhino is that you've got a
choice is that some people ignore it and some people don't.
And that you're more likely to ignore it that you want to
admit. And the people who can admit that vulnerability
actually have so much more power. In this moment, we are
all living through the biggest crisis in our lifetimes. We have
a global health crisis with the pandemic, we have an economic
crisis. And we also have a business crisis. And as we all
know, after every crisis, the awareness and scope of risk
management changes,
we are not dealing with risk, we are dealing with uncertainty,
it's not a question of which of a limited number of outcomes
will take place. It's a question of not knowing what the range of
potential outcomes is. And therefore we cannot assign
probabilities to those because we don't even know what they
are.
I think we have an ocean of emerging risks here. And we've
just got to keep ourselves safe. I try to
get people to think about how do you create urgency and not
panic. It's like if you know, certain building blocks aren't
there, there's still things that you can do. So that when the
right moment comes, you've got
a solution. As an accountant, you are able to see the entire
spectrum of the business because you look into the entire
financial performance. And you can provide insights, and aid in
the formulation of the organization's strategy.
If accountants can understand the business better, and and
provide unique solutions to where they were, that is an area
where they can add the most amount of value.
Integration of this known financial and financial elements
would be my best advice for all the boards that are out there
listening to us.
So accounting and finance professionals really understand
what drives business performance. But we really have
to go beyond financial statements that reflect the
performance of the past and be much more forward looking
Coronavirus this year, really helped people to understand that
yes, yeah, we really do take our eyes off the ball when it comes
to obvious things. I don't care how many levels
of defence you have, or if you want to bring an external, they
all fall down if they're not competent, the weakest one.
We've seen that spectacularly in recent years with major
organisations just just completely crashing and burning.
In some respects, we are really blessed that we went through the
2007 and 2008 banking crisis, because if we didn't learn from
that, and, and really built up the risk management of capital
and liquidity reserves in our banking system, we would be
right now having another crisis on our hands, which would be a
banking crisis. And that would be a much
deeper hole. There's just so much reskilling that needs to
happen in the world that we're looking at. There are
implications around mental health, you know, what we have,
you know, a pandemic is not easy. It's not anticipated. You
know, we are keeping people at homes. They're not used to
staying home, you know, human beings are social connectors.
So there were a lot of people doing, doing articles on how to
keep attention on climate change how climate change is related
to pandemics, whether they want to or not, banks are really
starting to think long and hard about what exposure they have to
climate risk through their customers, and indeed, embed
that in some of their risk modelling. But also to think
harder about their role as perpetrator, and what
contribution are they making to the climate emergency. Each
one of us I say, has what I call a risk fingerprint. And it's
true not just for individuals, but for companies, youknow, risk
culture in a company. And in countries, as I've seen, so much
so in sort of whiplash between the US and China. Part of it
also has to do with this sort of collectivist versus
individualist thinking. When you think about risk, you're not
just thinking about risk to yourself, but to your family to
your community. Your working environment
has become very challenging, there is a lot of uncertainty.
But a good accountant should be able to prepare predictive
analytical reports, which the CEOs can base on make good
decisions for the future.
Being a professional accountant. We are trained on
professionalism and ethics and we are bound by our professional
bodies code of ethics on these areas. So that sound grounding
gives us accountant hits hard in a career in risk management,
I think in a world where trust at the moment has become
vulnerable to work trust, the role of the accountant is even
much more necessary.
The accountancy profession is having an exciting rebirth,
because it will be dealing with value creation and the lead in
the c-suite will be the accountant who will be the true
change maker.
I see opportunities for both companies and accounting and
finance professionals. It's going to need a mindset
shift, not just from this traditional linear thinking to a
more complex model, but also from these you know, Black Swans
no accountability, oh, we never saw it coming to this grey Rhino
mentality. Where like, Yes, here are things that we see coming.
Let's hold ourselves and others accountable for doing something
about them.
You know, we are powerful, you know, what we put you know, our,
you know, sustainable reports are going to be very critical.
I have high hopes for 2021. And I believe that that will be the
year where especially in Poland, capital and financial market
participants, they will start incorporating non financial
criteria into their decision making.
What we say is the accountant of the future is the one who thinks
about planet, people purpose and then finally profits,
I would suggest thinking about incorporating more scenario
analysis, more storytelling.
It's a good time to use our brains and analyse risk on
different parameters and make this a bigger reality.