The role of today’s chief risk officer has shifted from technical expert to business advisor, and has propelled CROs into a world of complex stakeholder relationships, business navigation and regulatory expectations. According to a new study, this poses significant challenges for aspiring CROs in maximising the effectiveness of businesses risk functions.

It also states that finding the next generation of talent will prove difficult for many organisations. Those that succeed will establish CROs as senior executives who are close confidants of the CEO able to contribute positively to the strategy and operation of the business.

Published by the LMA’s Chief Risk Officer Committee with support from the Korn Ferry Institute, the report charts the rapid evolution of the CRO role since the financial crisis and its continued expansion in scope and importance, particularly for insurers.

Chair of the LMA CRO Committee and chief risk officer at Argo Group, Alex Hindson, said: “This report is an important contributor to the evolving discussion regarding the nature of the chief risk officer role and the personal qualities required to fulfil such a role in the insurance industry. Developing the risk management talent of the future and ensuring it is prepared to meet the threats and opportunities facing our industry is an important element of building the risk function of the future.”

The LMA's analysis concludes that managing ambiguity and conflict, cultivating innovation and situational adaptability are key competencies for CROs to develop, requiring substantial effort from them and significant support from stakeholders.

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