The Role of Risk Management in Sustainable Development Efforts :: WRAL.com

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This article was written for our sponsor, the Poole College of Management, Master of Management, Risk & Analytics concentration.

While risk management may have once been relegated to a single employee in a company, in today’s technology-driven world, it’s a vital tool for all business leaders.

Risk management involves using data about potential risks that can affect a business, either positively or negatively, to create plans to mitigate and manage those risks.

“If you’re really interested in managing your risk in the future, think about the risks to your business over the next few years with risk management, and then pay attention to longer-term things,” said Mark Beasley, professor of accounting at Carolina State University’s North Poole College of Management and director of the school’s Enterprise Risk Management Initiative.

Enterprise risk management plays into many aspects of business, including sustainability. The Poole College of Management has created a Masters in Management program with a focus on risk and analytics that provides education on risk and links it to sustainability.

“Sustainability is not just about the environment,” said Heather Daniels, director of corporate risk and sustainability at Lockheed Martin Corporation. “It’s a huge element, but it’s also a resilience of the business to multiple factors. It’s our human capital and the diversity programs, it’s the governance structure of the business – it’s is more focused on the long term. What are we doing today to position for the continued resilience of the company and its products and services?”

Many companies consider an overview of sustainability that covers three areas: environment, social issues and governance, or ESG.

“ESG is becoming a buzzword to say that entities need to think not only about climate change, water and natural resources, but also about the social, which goes into the human dimension,” Beasley said. “How do we impact people? How does our product potentially help communities anyway, or hurt them?”

Risk management and sustainability efforts go well together. Enterprise risk management often looks at the risks a business will face in the next one to five years, and these same tools can be used to look to the long term to build sustainability.

Lockheed Martin Corporation is an entity that brings together risk management and sustainability.

“What has really been achieved is looking at risk from what have traditionally been two different lenses: shorter-term risk, looking at disruptions to programs and activities, and sustainability more from a long-term lens. longer term, looking at sustainability as a whole,” Daniels said. “It’s one of the strongest things we’ve been able to achieve by bringing the two functions together. Because you have both perspectives closely aligned, you’re looking at shared tools, processes, and assessment. Through that synergy, it brings deeper and richer analysis around these types of risks.”

Companies that care about environmental sustainability will not only benefit shareholders but also stakeholders, Beasley said.

“How does your business affect society? Beasley said. “You have an obligation to society not to destroy natural resources, not to take advantage of people or groups.”

Benefiting from the land in turn helps the business.

“We might look at it selfishly — like if you don’t buy sustainability or believe in it, you won’t do as well,” Beasley said. “But if your customers believe in it, you’d be better off. They’re going to buy products that they think are more sustainable, for example. If you don’t buy into it, your business could be hurt. It’s in your best interest. pay attention.”

That’s why Poole College of Management has created a Masters in Management program with a focus on risk and analytics that provides education on risk and links it to sustainability. Led by instructors with real-world experience, the program is Poole College’s latest initiative to meet business needs. Graduates have achieved success in everything from small startups to Fortune 500 companies.

The graduate program is offered asynchronously online on a part-time basis, so students can participate from anywhere in the world.

“We argue that risk management skills are becoming an expected core competency for any business leader,” Beasley said. “A concept of sustainability also becomes a core competency, so we’re going to bring those together. Our program is going to give students tools in their toolbox to really have skills that the talent market will expect of them if they’re ‘I going to take a leadership position.”

This article was written for our sponsor, the Poole College of Management, Master of Management, Risk & Analytics concentration.

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