Magazine article Risk Management


Magazine article Risk Management


Article excerpt


Risk Management has continually provided valuable, thought-provoking information and the February 1997 issue is the best yet. William J. Kelly's observations about the holistic nature of financing risk and rapid evolution of risk financing options were right on the mark. Carl H. Groth identified the future importance of the capital markets in financing risk and challenged his own brokerage community to assume a true consultant's role and to quit duplicating services. Every article was valuable, right up to Georges Balcer's comments about communicating needs to the insurance industry.

Each article called for change and creativity. One creative change would be for the brokers to find a new name for themselves, such as consultants, for if in fact, they do broker insurance, whether they receive a commission or not, they are compromising themselves and doing the client a disservice through a conflict of interest. Keep up the good work.

Richard J. Rocheford, Jr., CPCU President, STAR Risk Management Consultants, Inc.


I was most interested to read the articles addressing the debate on risk management standards in the January 1997 issue of Risk Management. The one thing that stood out was the range of perceptions, including fear, that are applied to the concept of a "standard".

Perhaps the reason that AS/NZS4360, the risk management standard produced by the joint Standards Australia/Standards New Zealand Technical Committee, has been so widely accepted is because of the way standards are developed and approved in Australia and New Zealand. The process is started by either an individual or organization putting forth a case for the development of a standard. Once satisfied of the need, the two organizations establish a joint technical committee.

In the case of AS/NZS4360, the committee had a total of 27 members, representing 22 industry, professional and government organizations, that set out to gather information. A total of 326 comments from 55 individuals and/or organizations were addressed by the committee before the document received unanimous approval.

The strength of this rather timeconsuming and occasionally frustrating process is that the final document is seen as the product of the discipline covered by the standard and its adoption is accepted voluntarily.

An additional strength of AS/NZS4360 as pointed out by Anne B. Allen is that the "standard describes the process of risk management." This was a deliberate decision of the committee-that the standard be generic and confined to setting out a management process capable of application not only across an organization but also to individual units, processes or projects. …

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