“It’s about the board beginning to understand at a strategic, tactical and operational level its propensity to take risk or to exercise control, which are two sides to this risk-appetite coin. We’re about to see a pretty major shift in the way that boards are going to look at this whole risk question.”

Anderson talks about how, in future, boards will be expected to use a far more metric-driven approach to risk that will include linking it to shareholder value, rather than specific risks such as currency, credit or reputation. “That is what your shareholders will be interested in,” he says.

Practically speaking

One of the biggest difficulties in developing an effective risk management strategy is putting a tangible structure to such an ethereal issue. Risk, to all intents and purposes, is a concept; an intellectual equation for dealing with the likelihood of events - in other words, it’s an attempt to read the future.

It’s the reason why the ISO felt it necessary to develop its standard and why the Institute of Risk Management felt it necessary to issue guidance on interpreting that standard.