What is a risk management professional and what do they do?

Risk management professionals (including risk analysts and risk managers) review potential risk factors involved in running a business. They will identify, assess and report on threats or risks that could impact an organisation, its staff and its assets. Risk analysts will also help companies determine the level of risk involved in making a particular business decision by reviewing financial documents, economic conditions and potential clients.

As a subject matter expert, they advise senior stakeholders within the organisation and ensure there is situational awareness across the wider business. Risk management professionals are typically employed by financial institutions, such as banks and insurance companies, although they may also work for any company that handles large amounts of money.

Key responsibilities

Responsibilities will vary, but examples include:

  • Analysing data to better understand potential risks and outcomes of decisions.
  • Assessing potential risks in business systems and developing appropriate prevention strategies.
  • Identifying economic and financial trends that may pose a risk to the company.
  • Preparing reports, summaries and presentations to effectively communicate results to stakeholders.
  • Reviewing business contracts, terms and scope to identify any risks.
  • Monitoring internal and external data points that may affect the risk level of a decision.
  • Suggesting improvements to company processes and policies to avoid operational risks.
  • Recommending improvements to existing risk modeling techniques.
  • Proposing new techniques for risk analysis and management.
  • Assisting in internal audits, where required, as well as analysing findings and helping to implement recommendations.
  • Analysing financial statements such as profit and loss, company budget and employee headcount reports.

Why are they important?

Risk analysts are essential in helping organisations to minimise or eliminate risks that could be detrimental towards the business and its goals.

Skills needed for this role:

Risk analysts must have excellent quantitative, analytical and critical thinking skills along with the ability to independently solve problems with data. Strong written and verbal communications skills are also essential to enable effective communication of results to stakeholders.

Career opportunities presented by this role

Risk is a growing business area with good career prospects - larger organisations are more likely to have a structured career path. However, enhanced regulations and a more risk-aware banking sector means organisations are investing more heavily in their risk functions. More experienced professionals can become self-employed consultants, who move from business to business.

Competencies

High level competencies required include:

  • Audit and assurance

    A. Advises on and communicates effectively the role and scope of audit and assurance engagements to relevant stakeholders.

    B. Applies regulatory, legal, professional and ethical standards relating to audit and assurance engagements.

    C. Plans and prepares for audit and assurance engagements.

    D. Performs effective audit, and assurance engagements.

    E. Reviews and reports on the findings of audit and assurance engagements.

    F. Guiding efficient and effective operations.

  • Data, digital and technology

    A. Identifies strategic options to add value, using data and technology.

    B. Analyses and evaluates data using appropriate technologies and tools.

    C. Applies technologies to visualise data clearly and effectively.

    D. Applies scepticism and ethical judgement to the use of data and data technology.

  • Financial management

    A. Links developments in global trade, markets, business practices and the economic environment to required improvements in the financial and risk management of an organisation.

    B. Advises on business asset valuations, capital projects and investments using appropriate analytical qualitative and quantitative techniques.

    C. Identifies, evaluates and advises on alternative sources of business finance and different ways of raising finance.

    D. Communicates and advises on the impact on financial decision making on current developments in regulation, governance and ethics.

    E. Assesses and advises on appropriate strategies to manage business and organisational performance regarding business and finance risk and effectively communicates the impact.

     

  • Governance, risk and control

    A - Evaluates organisational structures and governance to protect the long-term interests of stakeholders.

    B - Recommends appropriate strategies to ensure adherence to governance structures and application of best practice internal controls.

    C - Identifies and manages risk appropriately.

    D - Uses risk management for the best interests of an organisation and its stakeholders.

    E - Monitors and applies relevant legislation, policies and procedures.