Nassim Taleb, risk management guru and author of The Black Swan, says “We are the empirical decision makers who hold that uncertainty is our discipline… understanding how to act under conditions of incomplete information is the highest and most urgent human pursuit.”
You cannot, by definition, predict the next Black Swan event. However, the central idea in Taleb’s book is not to attempt to predict Black Swan events but to build robustness to their negative impacts.
- The pandemic revealed that too many firms lacked a plan to cope with a major crisis, says Dr Gianluca Pescaroli, Lecturer at the UCL Institute for Risk & Disaster Reduction.
- The U.K. mini budget announced in September wreaked havoc on U.K. currency and bond markets.
- Supply chains are being tested by the war in Ukraine.
- The cost of living crisis is affecting everyone.
Are any of these true Black Swan events? Let’s leave that debate to the academics. However, there is little doubt that now is the time to strengthen the governance, risk, and compliance practices at your organisation.
Having spoken to countless risk professionals over the last five years, the one thing that almost always comes up is that many organisations still take a fragmented approach to risk management, and departments often operate in silos.
Silos lead to poor decision-making due to a lack of shared information.
Talking about her new book, Anthro-Vision: How Anthropology Can Explain Business and Life, Gillian Tett—an award-winning journalist and the woman who predicted the global financial crisis—was asked what she considers to be the biggest potential risks facing us in the future.
“We are seeing a similar pattern of intense tribalism, groupthink, and tunnel vision having emerged in the tech sector in recent years. That’s worrying,” Tett said.
“We saw a propensity to ignore social sciences around medicine in the run-up to 2020…. We’re frankly also ignoring many of the issues around AI in general today. Because, once again, technical knowledge is held in the hands of a tiny group of elite technocrats—who the rest of the world tends to ignore because their activities are labelled as boring and geeky and dull and therefore not of interest to everybody else.”
Just this week, Tett delivered her assessment on whether, as Jacob Rees-Mogg has suggested, the Bank of England is to blame for the current turmoil in the UK financial markets—describing the suggestion as “pretty much bollocks”. This probably means we should sit up and listen.
Unfortunately, we don’t have Gillian Tett speaking at #RISK. Thankfully, we also don’t have Jacob Rees-Mogg. However, the strapline for the event is, “risk is now everyone’s business”, and we will be addressing the need for “silo-busting” throughout risk management.
Silos can undermine organisations of all types—and in this crazy world, we perhaps need more of a “renaissance woman or man” approach—people with many talents and areas of knowledge rather than specific deep-dive expertise.
→#RISK - ExCeL LONDON: 16th & 17th November 2022
Europe’s Leading Risk Focused EXPO
Risk is now everyone’s business
#RISK is where the whole ‘risk’ community comes together to meet, debate, and learn, to break down silos and improve decision-making. Five content hubs with insightful sessions, case studies, networking, high level thought leadership presentations and panel discussions.