Authbridge

timesascent.in : Ajay Trehan, founder & CEO, AuthBridge Research Services talks on the importance of risk management in the current global business scenario.

1. How important is risk management in the current global business scenario?

In the current global business scenario, when jobs are drying up and the horizon is not looking optimistic, organisations and their management teams are busy controlling damage and sustaining operational health of their organisations. Thus, it is important for an organisation to raise its guards at this time and seek external professional organisations to watch over the back of their management teams as they are busy controlling damage.

2. In an emerging economy like India, what significance can risk management have?

It has been historically seen that 80 per cent of the frauds in an organisation happen during its growth stage. Emerging economies like India have various high growth sectors and therefore various organisations who are riding the growth wave. Management teams at these times are mostly focused on catering to growing customer demands and therefore aggressively buying infrastructure, hiring people, engaging with more and more vendors and business associates and all of this mostly happening at breakneck speed.
Caution can get thrown to the wind in such times and that can be dangerous. We are aware of organisations that suffered major damages later just because implementing basic processes was somewhere down below in the priority list.

3. What are the key trends being witnessed in the area of risk management?

In the recent past, there seems to be a general heightening of barriers all around India Inc. Organisations are calling on specialist organisations to help them audit and improve their risk management and fraud prevention processes. Over the last 3-4 months, we have seen higher number of request for information than what we saw in the past. We have also come across organisations that had their own internal resources to carry out some of these assignments, now looking for specialised external teams to help them.

4. What, in your opinion, has fostered this new mindset amongst business leaders?

I think the primary reason is the increased threat perception. However, the current global scenario is one of the contributing factors to the increased threat levels as well. There are instances of organisations coming to us because one of their key vendors or distributors is absconding and is holding inventory or other Intellectual Property with him. Investigations have revealed that the person was an unscrupulous person who had a dubious record of swindling money - our client somehow did not know that at all. This person obviously went missing as he owed a lot of money to a lot of people. In the process, however, our client lost its presence in that market and of course suffered financial loss as well.