Deborah Luthi has nearly three decades of experience in the risk management industry. She currently serves as the vice president of the Risk and Insurance Management Society Inc. board of directors and has served previously as secretary and treasurer of the board, board liaison to the External Affairs Committee and liaison to the Professional Development Committee.
Q. How can a business save money on risk management?
If you’ve managed the risk and really know the risk so that you can take advantage of those opportunities, then, as they say, insurance is one of the last things that you’re considering that in and of itself is going to bring down the cost of managing risk. When you better understand those risks and can manage them, then that allows an organization to say, ‘Well, we know how to deal with this risk, we can take more of it, we can take other opportunities.’ It’s not only that downside of risk but also the upside, as well.
Q. How can risk management help that proverbial bottom line?
I think this whole process is really about building resiliency and sustainability into an organization. If you don’t have that, you don’t have a bottom line. I think that’s probably the biggest advantage, building that resiliency and sustainability. I think that when you’re creating a forum and an opportunity for discussion about risk, making what I call risk-adjusted or risk-weighted decision, that really helps you with that bottom line. You’re always looking at that and thinking about it in terms of whether this will increase or decrease the bottom line. It is a continuous learning process.
Q. What should businesses do to ensure their risk management plan is successful?
Definitely, there needs to be a risk champion. That might be a chief financial officer, but for organizations that recognize that a chief officer’s plate is pretty darn full, risk management and leading this kind of a process is a professional discipline in and of itself. A chief financial officer is really a great person to be the facilitator of all this.