We fail and then we fail to learn!
The long list of failures to manage enterprise risks is too depressing to list here. Such a waste of time, money and life!What an opportunity cost to corporate entities and society.
The only long lasting positive thing to come out of each major risk event or negative aggregation risk outcome is legislation
Our present crop of senior managers executives fund managers and politicians are not any worse or better than previous ones. Talking a good game about risk governance or compliance GRC is often followed by another failure to manage risks with all stakeholders in mind.
Eventually the general public start looking for heads to lop off and new legislation is written that can often be more risk-averse than it needed to be but The People got sick of the incompetence at the top and something had to be done.
Business leaders and politicians often moan about statutory legislation but if managers could manage risks better we wouldn’t need more legislation. Recent examples of major risk events or aggregation of regular failure to manage smaller risk events are more examples of our key risk decision makers failing and more legislation is required to fill the gap in risk management knowledge and/or failing corporate risk management culture.
- Construction Skills Gap
- Carillion Collapse
- Oxfam: Catastrophic Fatal Reputation Damage?
- Grenfell Tower Fire
- In a survey of 300 tech leaders, 43 percent said the skills shortage was their greatest concern in 2018
- NHS suffered massive cyber attacks and while some trusts can’t staff their hospitals others can. Nurses are leaving in droves, but where are they going and how do we get them to come back, or stem the blood-loss!
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The world is full of opportunities to develop for the benefit of all, yet we can’t keep what we have on an even keel. We have to during the 4th Industrial Revolution make changes for the better.
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22nd February 2018 Members of UK’s Parliament MPs Question Pensions Regulator In Public
The Pensions Regulator head with responsibility for monitoring pensions and protecting pensioners in UK admitted to MPs that the Pensions Regulator needed to be clearer quicker and tougher in using its powers to force companies to pay more into their pension schemes.
As an example of the Pensions Regulator’s failure one could highlight Carillion where many thousands of pensioners face reduced pensions. Carillions pension Trustees asked the Pension Regulator in 2010 and 2013 to force Carillion to put more money into it’s pension scheme. The Pension Regulator twice refused and the Pension Regulator CEO since 2015 admitted that it should have done more to extract higher pension contributions from Carillions executive management team.
Carillions executives have claimed that a failing Qatar contract was one of the main causes of Carillions collapse, but auditors KPMG say that was not a cause of Carillion’s collapse.
KPMG tried to defend their auditing of Carillion’s accounts in 2016 and 2017, but the business select committee chairperson said she would not hire you KPMG to audit the contents of my fridge.
Much criticism has been expressed about the system of corporate governance in UK’s biggest companies. Who is responsible for the loss of pension benefits for Carillion pensioners is not clear but what is clear that the current system of corporate governance and risk management is not working for stakeholders like pensioners majority of employees contractors shareholders and corporate customers. The winners are winning big and the losers are losing big!
20th February 2018 UKs Pension Regulator Ignored Trustees Of Collapsed Outsourcing Firm Carillion
The pensions regulator twice ignored requests from trustees of Carillion to force the company to fill Carillion’s pension black hole.
The pensions regulator has come under fire from UK’s members of parliament for failing to take steps to protect Carillion’s pension scheme members, especially as they were asked twice by the trustees of the pension before Carillion collapsed. When Carillion collapsed, the firm had pension liabilities of around £3 billion.
With characteristic alacrity, the Pensions Regulator started its arduous process of chasing money down from Carillion a few days after it was formally announced there was no money left Frank Field chair of parliaments Work and Pensions Committee.
The Pension Regulator didn’t comment on the continued significant bonuses consistently awarded to Carillion executives or the dividends issued to shareholders with between £2-3 billion in underfunded pensions.
Carillion’s pension scheme now has to be transferred to the Pension Protection Fund which is likely to mean the loss of benefits for the majority of the 27,500 pension scheme members.
If the Pensions Regulator had conducted an Enterprise Risk Management Audit of Carillion they would clearly have identified that the black hole was not an unfortunate coincidence but a systemic failure of Carillion’s corporate governance and risk management culture.
Let’s hope the people at the top make the right decisions!
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