Risk Insider: Quin Rodriguez

How to Talk Enterprise Risk Management to the Board

By: | September 20, 2018 • 2 min read
Quin is Vice President, Strategy, for Riskonnect. He is responsible for leading Riskonnect's vision to drive growth and engagement in the Integrated Risk Management market. Quin has 18+ years of Executive Sales Management and Leadership experience.

Developing and executing effective enterprise risk management programs start with getting corporate leaders engaged, including board members. But as risk management teams often realize, this is much easier said than done.

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With numerous corporate issues demanding their attention, board members may often place proactive risk management strategies behind more pressing, immediate corporate concerns that promote growth and innovation.

So how do you get their attention? In my experience it comes down to aligning risks with high-level corporate concerns as well as creating clearly defined roles and responsibilities for board members and the larger leadership teams.

Interrelate What Matters

The most essential strategy for presenting risk management processes to the board is connecting risk with larger enterprise concerns, including financial loss and brand reputation.

Consider the financial burden of a cyber breach, for example. A recent Ponemon Institute and IBM study found that the average total cost of data breaches in the U.S. reached a record-breaking $7.35 million in 2017, with the average cost to businesses per record lost or stolen at $225 across all industries. For most enterprises, these can be crippling losses.

In addition to the financial costs, reputational impact can also build the case for leadership involvement. With each major newsworthy risk, enterprises may face year-long battles to restore their reputation. Once consumers lose trust in your brand, enterprises are likely to face high customer turnover, lower profits and as a result, lost market share.

By attributing enterprise costs and reputational impact to various risk areas, risk management teams can build the case for more efficient strategies and engage board members to understand the importance of being involved in policy execution.

Educate the Board on Risk Processes

Though many companies and organizations have improved their communications with board members about risk oversight, a 2017 PWC study suggests that nearly 20 percent of surveyed corporate leaders still need clarity on how their roles influence risk management.

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Too often board members aren’t properly educated on their roles and responsibilities as they pertain to enterprise risk, which is a breeding ground for brand nightmares. When proper education is provided, the board benefits from clearly defined responsibilities, a greater understanding of enterprise risk factors, and the knowledge to lead a successful corporate risk management program.

For board members, they must feel confident in their abilities to clearly and efficiently respond to risk concerns, both in enterprise operations and media management.

Because of the increase in demand for board members to have greater understanding of risk management, you want to make sure members are provided sufficient information to be successful. This is best achieved by ensuring they understand the benefits of an established enterprise risk management program as well as their individual roles in executing this plan.

More from Risk & Insurance

More from Risk & Insurance

4 Companies That Rocked It by Treating Injured Workers as Equals; Not Adversaries

The 2018 Teddy Award winners built their programs around people, not claims, and offer proof that a worker-centric approach is a smarter way to operate.
By: | October 30, 2018 • 3 min read

Across the workers’ compensation industry, the concept of a worker advocacy model has been around for a while, but has only seen notable adoption in recent years.

Even among those not adopting a formal advocacy approach, mindsets are shifting. Formerly claims-centric programs are becoming worker-centric and it’s a win all around: better outcomes; greater productivity; safer, healthier employees and a stronger bottom line.

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That’s what you’ll see in this month’s issue of Risk & Insurance® when you read the profiles of the four recipients of the 2018 Theodore Roosevelt Workers’ Compensation and Disability Management Award, sponsored by PMA Companies. These four programs put workers front and center in everything they do.

“We were focused on building up a program with an eye on our partner experience. Cost was at the bottom of the list. Doing a better job by our partners was at the top,” said Steve Legg, director of risk management for Starbucks.

Starbucks put claims reporting in the hands of its partners, an exemplary act of trust. The coffee company also put itself in workers’ shoes to identify and remove points of friction.

That led to a call center run by Starbucks’ TPA and a dedicated telephonic case management team so that partners can speak to a live person without the frustration of ‘phone tag’ and unanswered questions.

“We were focused on building up a program with an eye on our partner experience. Cost was at the bottom of the list. Doing a better job by our partners was at the top.” — Steve Legg, director of risk management, Starbucks

Starbucks also implemented direct deposit for lost-time pay, eliminating stressful wait times for injured partners, and allowing them to focus on healing.

For Starbucks, as for all of the 2018 Teddy Award winners, the approach is netting measurable results. With higher partner satisfaction, it has seen a 50 percent decrease in litigation.

Teddy winner Main Line Health (MLH) adopted worker advocacy in a way that goes far beyond claims.

Employees who identify and report safety hazards can take credit for their actions by sending out a formal “Employee Safety Message” to nearly 11,000 mailboxes across the organization.

“The recognition is pretty cool,” said Steve Besack, system director, claims management and workers’ compensation for the health system.

MLH also takes a non-adversarial approach to workers with repeat injuries, seeing them as a resource for identifying areas of improvement.

“When you look at ‘repeat offenders’ in an unconventional way, they’re a great asset to the program, not a liability,” said Mike Miller, manager, workers’ compensation and employee safety for MLH.

Teddy winner Monmouth County, N.J. utilizes high-tech motion capture technology to reduce the chance of placing new hires in jobs that are likely to hurt them.

Monmouth County also adopted numerous wellness initiatives that help workers manage their weight and improve their wellbeing overall.

“You should see the looks on their faces when their cholesterol is down, they’ve lost weight and their blood sugar is better. We’ve had people lose 30 and 40 pounds,” said William McGuane, the county’s manager of benefits and workers’ compensation.

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Do these sound like minor program elements? The math says otherwise: Claims severity has plunged from $5.5 million in 2009 to $1.3 million in 2017.

At the University of Pennsylvania, putting workers first means getting out from behind the desk and finding out what each one of them is tasked with, day in, day out — and looking for ways to make each of those tasks safer.

Regular observations across the sprawling campus have resulted in a phenomenal number of process and equipment changes that seem simple on their own, but in combination have created a substantially safer, healthier campus and improved employee morale.

UPenn’s workers’ comp costs, in the seven-digit figures in 2009, have been virtually cut in half.

Risk & Insurance® is proud to honor the work of these four organizations. We hope their stories inspire other organizations to be true partners with the employees they depend on. &

Michelle Kerr is associate editor of Risk & Insurance. She can be reached at [email protected]