Euro-breakup a key threat to UK – Portillo Keynote

Michael Portillo Euro-zone crisis the  key economic threat

Michael Portillo, who described himself as a “former future Prime Minister”, told the annual conference that the Euro-zone crisis was the main threat to economic stability. In an entertaining and insightful speech, delivered without notes, he said that austerity in countries like Greece and Spain would prove to be “pointless and fruitless” because their governments do not have the freedom to devalue their currencies. The result would be to depress output and so add to indebtedness rather than reduce it.

He also highlighted the build-up of derivatives and other complex financial instruments, which, he said, were equivalent to ten years’ of global GDP: “It is the elephant in the room governments are trying to ignore.”

Sir Richard Lambert Risk aversion a threat to recovery

Former CBI Director-General Sir Richard Lambert urged the audience to strike the right balance, avoiding excessive caution. The role of the risk manager had never been more important, he said, and could make all the difference between corporate success and failure: “The risks of managing risks have never been greater.”

He warned, however, that there would be no chance of recovery if the pendulum swung too far in the opposite direction towards risk aversion.

He advised the audience to concentrate on what is important, screening out the background noise, and to be willing to ask “stupid questions”. Drawing on his own experience as a member of the Bank of England Monetary Policy Committee, he said mistakes could have been avoid if only people had been willing to do so.

John Hurrell Hurrell urges risk managers to get real about claims

In his opening speech to conference, chief executive John Hurrell gave a mainly upbeat assessment of the prospects for risk managers, but warned that they would have to respond to the changing claims environment.

Acknowledging that the subject was of great concern to members, he said that the days when insurers would make ex-gratia payments on large claims were over. Whereas in the past relationships might have won the day, the process is now much more legally-driven.

Looking at the wider picture it was, he said, “a terrific time for risk management and risk managers. There has never been a greater opportunity for them to influence their organisations”.

He said the publication in July of ‘Roads to Ruin’ – the analysis of the factors behind corporate failure – had put Airmic on the map among business organisations that previously had little to do with the association. He described it as “one of the most profound pieces of risk management research over the past ten years.” He predicted its sequel to be published next year, ‘Roads to Resilience’, would have a similar relevance.

Paul Taylor Taylor outlines progress towards recognition of risk management profession

Paul Taylor ended his year as he had begun it – discussing from a conference platform his aspirations for risk management to become a recognised profession. This time, however, he had progress to report on the long-term aim of chartered status.

Setting out the reason for his vision, he described his own frustrations working with other professionals. “Chartered this, chartered that. Who are we? We’re Mr No Name. We have no professional recognition,” he said.

He described how in the past year Airmic had moved “outside its comfort zone” to take its message to new audiences such as the CII, Institute of Directors, the ABI, City Business School and Cranfield University. “This will hopefully get the profession better recognised,” he predicted.

The Board, he pointed out, had successfully drawn up a long-term strategy under an over-arching theme, supported by operational efficiency and embracing three core aims: Professional Development, Professional Recognition and Thought Leadership. He paid tribute to the work of the secretariat. “Airmic, I believe, is now a very solid, effective and efficient organisation,” he said. “We also have our partnership, which provides moral and financial support.”