Risk Insider: Elizabeth Carmichael

Saying ‘No’ to a Risk

By: | March 24, 2016 • 2 min read
Elizabeth Carmichael is president of Carmichael Associates LLC. She formerly was director of compliance and risk management for Five Colleges Inc. She can be reached at info@carma-llc.com.

Being the person who directly says “no” to a risk can be somewhat perilous for a risk manager. As most of us know, the risk manager’s job is more about helping the organization to make an informed decision than being the arbiter of all risk-taking.

It is tempting to support an administrator who has asked for a risk assessment on a proposal that they don’t want to undertake by letting the administrator “blame risk management” for the negative decision, i.e., “Risk Management says we can’t do it.”

All I can say is, don’t do this. Don’t let administrators ever “blame” risk management for a decision unless you actually had the responsibility and authority in your office to make the decision and did so.

This pattern typically exists in organizations where administrators have little or no authority to make decisions, or in organizations where customers (students or parents in higher ed) have easy access to the president or other senior managers who overturn lower managers’ decisions without all the facts at hand.

All I can say is, don’t do this. Don’t let administrators ever “blame” risk management for a decision unless you actually had the responsibility and authority in your office to make the decision and did so.

In performing the risk assessment, be sure to consider the upside of the project, activity or event. Even brainstorm them so that you get a comprehensive list. Then consider the downside, the risks associated with the project, activity or event, and what risk mitigation would be needed for those risks.

Do your best to identify time and money costs to the mitigation efforts. This will give your decision-making administrators the documented ability to say, “We have completed a thorough risk assessment and mitigation analysis on this proposal and collectively determined that the return or reward on the project is insufficient to offset financial or other risks and the administrative costs of mitigating the risks that would be associated with the project. We regret that we cannot undertake this project at this time.”


Rather than allowing your decision-makers to “blame” risk management, empower them to communicate their educated and well-thought-out decision to stakeholders personally. (They may also surprise you and choose to do it!)

The role of risk management should be to conduct and facilitate risk assessments, and then educate our stakeholders on the outcomes of those assessments. So even if your current administration is comfortable with risk management being seen as the decision-maker, future administrations may not, and you and your department may be seen in a negative light that is difficult to shake, including being labeled as overreaching, lazy (it’s easier to say “no”), and simple nay-sayers, even if that’s not true.

Rather than allowing your decision makers to “blame” risk management, empower them to communicate their educated and well- thought-out decision to stake holders personally. (They may also surprise you and choose to do it!)

Therefore, especially for those of you whose organizations are somewhat dysfunctional, prepare your risk assessment and mitigation plans with the expectation that the president or a future president may be reading it.

Encourage the administrators that you are working with to share the proposal and risk assessment as high up the ladder as possible, and be seen as a positive, helpful force for good management in your organization.

More from Risk & Insurance

More from Risk & Insurance

In the Fast-Paced World of Retail, This Risk Manager Strives to Mitigate Risks Proactively and Keep Senior Leaders Informed

Janine Kral works to identify and mitigate risks, building strong partnerships with leaders and ensuring they see her as support rather than a blocker. 
By: | October 29, 2018 • 4 min read

R&I: What was your first job?

My very first paid job was working on my uncle’s ranch in British Columbia in the summers. He had cattle, horses and grapes — an unusual combo. But my first real job out of college was as a multi-line claims adjuster at Liberty Mutual.

R&I: How did you come to work in risk management?

Right out of college I applied for a job that turned out to be a claims adjuster at Liberty Mutual. I accepted because they were offering six weeks of training in Southern California, and at the time that sounded really fun. I spent about three years at Liberty Mutual and then I spent a short period of time at a smaller regional insurance company that hired me to start a workers’ compensation claims administration program.

I was hired at Nordstrom as the Washington Region Risk Manager, which was my first job in risk management. When I started at Nordstrom, the risk management department had about five people, and over the years it has grown to about 75. I’ve been vice president for 11 years.

R&I: What’s been the biggest change in the risk management and insurance industry since you’ve been in it?

I would say that technology has probably been the biggest change. When I started many years ago, it was all paper and no RMIS.


R&I: What risks does the retail industry face that are unique?

We deal with a lot of people — employees and customers. With physical brick and mortar settings, there are the unique exposures with people moving in and out in a public environment. And of course, with ecommerce, we have a lot of customer and employee data, which creates cyber risk — which is not necessarily a unique risk in today’s environment.

R&I: Can you describe your approach to working with senior leaders and front-line staff alike to further risk management initiatives?

It starts with keeping the pulse of what’s happening with the business. Retail moves really fast. In order to identify and mitigate risks proactively, we identify top risk areas and topics, and then we ensure that we have strong partnerships with the leaders responsible for those areas. Trust is critical, ensuring that leaders see us as a support rather than a blocker.

R&I: What role does technology play in your company’s approach to risk management?

Janine Kral, claims adjuster, Nordstrom

We have an internal risk management information system that all of our locations report events into — every type of incident is reported, whether insured or uninsured. Most of these events are managed internally by risk management, and our guidelines require that prevention be analyzed on each one. Having all event data in one system allows us to use the data for trending and also helps us better predict what may happen in the future, and who we need to work with to mitigate risks.

R&I: What advice might you give to students or other aspiring risk managers?

My son is a sophomore in college, and I tell him and his friends all the time not to rule out insurance as a career opportunity. My advice is to cast a wide net and do your homework. Research all the different types of opportunities. Read a lot — articles, industry magazines, LinkedIn. Be proactive and reach out to people you find interesting and ask them about their careers. Don’t be shy and wait for people and opportunities to come to you. Ask questions. Build networks. Be curious and keep an open mind.

R&I: What are your goals for the next five to 10 years of your career?

I have always been passionate about continuous improvement. I want to continue to find ways to add value to my company and to this industry.

R&I: What is your favorite book or movie?

My favorite book is Shantaram by Gregory David Roberts. It’s a true story about a man who was in prison in Australia after being convicted of armed robbery, and he escaped to India. While in India, he passed himself off as a doctor in a slum. It’s a really interesting story, because this is a convicted criminal who ends up helping others. I am not always successful in getting others to read the book because it’s 1,000 pages and definitely a commitment.

R&I: What’s the best restaurant you’ve ever eaten at?

Fiorella’s in Newton, Massachusetts. Great Italian food and a great overall experience.


R&I: What is your favorite drink?

“Sister Carol.” I have no idea what is in it, and I can only get it at a local bar in Seattle. It’s green but it’s delicious.

R&I: What is the riskiest activity you ever engaged in?

Skydiving. Not tandem and without any sort of communication from the ground. Scary standing on a wing of a plane, but very peaceful once the chute opened, slowly floating down by myself.

R&I: If the world has a modern hero, who is it and why?

I can’t think of one individual person. For me, the real heroes are people who have a positive attitude in the face of adversity. People who are resilient no matter what life brings them.

R&I: What about this work do you find the most fulfilling or rewarding?

It’s rewarding to help solve problems and help people. I am proud of the support that my team provides others. &

Katie Dwyer is an associate editor at Risk & Insurance®. She can be reached at kdwyer@lrp.com.