Risk Management
“A person with experience is never at the mercy of someone with only a theory.”
Anonymous
The same can be said for Risk Management.Any large consulting firm can – and will – recite to you from industry best practices, but how many of them will actually understand the nuances and implications of what they are saying?
International Commerce understands that, in the management of risk, one size does not fit all.We will not make generic recommendations to you because that’s what the average company needs. We will make specific recommendations based on your:
- Corporate objectives
- Risk appetite
- Company size and organization
- Core Capabilities
These recommendations will be based on practical economics… never will we recommend a $1 million fix to a $100,000 problem.
People, Process and Technology
Managing risk can be simply described as the act of analyzing, measuring and mitigating risks which are not acceptable to an organization.People, process and technology are the necessary tools to manage risk successfully – but only if they truly are in sync with each other.All companies have people, process and technology, but many fail to recognize that they operate as three silos rather than in concert.
International Commerce does understand this synergy for the reason stated before… experience.Each of International Commerce’s partners have cross-over skills:
- Trading, IT, and Trade Floor Design/Configuration
- Audit, Controls, M&A and Sarbanes-Oxley
- Trading, Risk Management, Policy and Procedures, Marketing
- IT, Pricing and Forward Curves
These cross-over skills ensure that you not just have the appropriate people, process and technology, but that they work together smoothly.
Defining your “Business Risk Model”
Risk is not inherently good or bad, but it can lead to good or bad results. Before designing the risk management capabilities for any organization, it must first be determined:
- Which risks to keep:All companies have core competencies and will commonly accept risks relating to those competencies.
- Which risks to manage:For example, any vendor is exposed to the risk that their customers won’t pay. This performance risk must be managed.
- Which risks to mitigate:Many companies cannot afford a catastrophic business interruption, thus mitigate this risk by purchasing insurance.
International Commerce can help you determine the Business Risk Model appropriate to your organization, then ensure your infrastructure is sufficient to support that model.
Categories of Risk Management Services
- Perform compliance audits
- Design the Risk Oversight Structure for the organization, from the Board of Directors down to line management.
- Review and improve Trade Control procedures
- Implement “compliance tracking” tools with proven ability to decrease “deal capture errors” – believed by many to be the most insidious risk to trading.
- Review, design and compose trading and risk management Policy and Procedures documents
- Setting up and implementing appropriate controls on the Forward Price Curve methodology and the quality of pricing data in general
Why take the risk? Learn what you can do to avoid it. Contact Dunham Cobb today.
dunham@ici-1.com or call 561-818-5518.