The Chief Risk Officer (CRO) position is relatively new, but gaining traction. The CRO is responsible for planning, implementing, directing, and administering a company’s enterprise risk management program to achieve maximum profitability.
The successful CRO typically has a college degree in business, economics, finance or engineering, and over 10 years experience in a broad range of business functionalities. This broad experience ensures the CRO is familiar with all business risks that are present within a company, including strategic, financial, operational, and hazard risks.
The CRO is a high level executive whose main responsibilities include:
- Working closely with senior management to develop and carry-out a company’s enterprise risk management program
- Formally identifying and documenting specific risks in the strategic, operational, financial, and hazard risk centers
- Understanding, assessing and quantifying underlying risk associated with a company’s risk centers and reporting those risks for top level management
- Identifying and communicating with senior and functional management about risks that may impact a company’s profitability or cause a financial loss
- Setting risk control priorities in response to the risk mitigation requests set forth by senior management
- Coordinating and overseeing implementation of risk controls in various departments to reduce and transfer risk
- Evaluating the success of risk controls and monitoring their status over time
- Implementing and updating the framework, policies and processes under which risk assessment is performed and risk controls are placed, including determining action items, scheduling mitigation activities, and implementing schedules to ensure early detection, management and mitigation of risks
- Analyzing historical risk exposure and loss trending to implement best practices throughout a company’s corporate structure.