Risk Manager

Risk management in the financial world essentially is the practice which involves analyzing a project or an investment, identifying the risks associated with the act, and being informed of all the possible outcomes and forming policies to minimize the impact of potential losses and other risks. There are several risks that a company may be exposed to. Some of these risks are the following:

Business risk: In order to obtain its reward, business risks are almost impossible to avoid. To optimize this to the fullest, it is important to establish the company’s risk to reward ratio. Some types of business risks are economic risk, legal risk, quality risk, and political risk.

Financial risk: Financial risk is generally caused by fluctuation in the financial sector. Some factors affect this are interest rates, stock prices, and various other economic factors. A few types of financial risks are liquidity risk and operational risks.

Investment risk: It is the difference between the level of uncertainty of returns on investment, as compared to the expectations of the investor. Some types of investment risks are inflation risk, foreign investment risk, and concentration risk.

International business risk: This is caused by unfavorable events occurring in international business operations. Changes in global economies and different objectives may cause such a risk. Examples of such a risk are political risk, cultural risk, and exchange risk.

Technology risk: Information technology risk occurs when there are security breaches and operational failures. Some examples are artificial intelligence risks, budget risk, loss of data and infrastructure risk.

Credit risk: Also known as default risk, is the loss incurred by a party when the borrower doesn’t fulfill its financial obligations to repay its debt. Types of credit risk are concentration risk, country risk, and credit default risk.

Insurance risk: Insurance risk covers the probability that an incident will occur, for which the insurer has to pay the insured. In life insurance, for example, the risk is that the insured person will die (due to reasons like lifestyle and activities) before their premium is due.

As a risk manager, your responsibility is to ensure that the project you’re overseeing is under a management system that identifies and protects the company from potential threats/risks, and allows it to operate while minimizing the impact of such risks.

Key roles and responsibilities

A risk manager works directly for a company or provides risk consulting to various companies. Here are some of his responsibilities depending on your specialized area of work:

• Reading various reports such as economic reports, financial statements, reports on loan repayment records of a bank's clients, reports on security breaches in your company's information systems, etc.
• Analyzing a lot of information on economics, business, political scenarios, currency exchange rates, financial situations, investment situation, trade policies of various countries, types of malware and cyber attacks, etc. to find out different types of risk involved for your company or for your clients.
• Managing policies of the company such as global and national insurance policies to enable full transparency while operating.
• Structuring risk-related and legal contracts when engaging with various parties such as vendors, agents and service providers. You must also see to it that these records are filed and stored properly.
• Outlining a plan that will help minimize the risks you have detected. A risk management plan consists of various factors such as methods and approaches used to mitigate risks, the roles, and responsibilities of each team of the company, setting a budget to execute the plan, calculating the impact of each approach and tracking its progress.
• Coordinating with various departments involved in the planning, reviewing the management plans, producing reports and presenting them to the company stakeholders.

• Enterprising: You should have interests for Enterprising Occupations. Enterprising occupations involve taking initiatives, initiating actions, and planning to achieve goals, often business goals. These involve gathering resources and leading people to get things done. These require decision making, risk taking and action orientation.

• Conventional: You should have interests for Conventional Occupations. Conventional occupations involve repetitive and routine tasks as well as fixed processes or procedures for getting things done. These occupations involve working more with data, systems, and procedures and less with ideas or creativity.

• Social: You should have interests for Social Occupations. Social occupations involve helping or assisting others; these involve working with and communicating with people to provide various services; these may involve educating and advising others.

Abilities

• Articulation: The ability to speak clearly so others can understand you.

• Emotional Intelligence: The ability to understand your own and others' emotions and feelings; empathy for others; adjusting your behaviour or self-control and self-regulation according to others' emptions and situations.

• Fluency of Ideas: The ability to come up with a number of ideas about a topic (the number of ideas is important, not their quality, correctness, or creativity).

• Inter-Personal:          The ability to build and maintain good relationships with others at workplaces and elsewhere.

• Oral Comprehension: The ability to listen to and understand information and ideas presented through spoken words and sentences.

• Oral Expression: The ability to communicate information and ideas in speaking so others will understand.

• Problem Sensitivity: The ability to tell when something is wrong or is likely to go wrong. It does not involve solving the problem, only recognizing there is a problem.

Knowledge

• Business Management:       Knowledge of managing a business which involves planning of what to do, organising resources and people, leading and supervising work activities of people, and monitoring performances of people as well as performance of business. This includes knowledge of marketing, finance, human resources management, operations management, etc.

Skills

• Active Listening: Giving full attention to what other people are saying, understanding the points being made by others, asking questions, etc.

• Coordination: Skills in working together with other people to get things done.

• Critical Thinking: Skills in analysis of complex situations, using of logic and reasoning to understand the situations and take appropriate actions or make interpretations and inferences.

• Directing: Skills in directing others' actions to get things done.

• Judgment and Decision Making: Skills in considering pros and cons of various decision alternatives; considering costs and benefits; taking appropriate and suitable decisions.

• Problem Solving: Skills in analysis and understanding of problems, evaluating various options to solve the problems and using the best option to solve the problems.

Personality

• You are always or mostly organised in your day-to-day life and activities.

• You always feel secure in your surroundings and in most situations.

• You are always self-satisfied or feel satisfied with your life in most situations.

• You are a soft-hearted person sometimes.

• You trust others sometimes but not always.