Leaders League is a media group specializing in press, industry market research, and the organization of international summits for business leaders.
The group publishes the reference magazine for general management, 'Decideurs Magazine' which deciphers and follows the evolutions and strategies of key players in the business world.
Sonepar Vice President, Risks and Insurance François Beaume was recently interviewed by the magazine on the subject of why now more than ever, risk management has proved its importance. To read the interview in French, click here.
Decideurs: How did you manage the health crisis at Sonepar? Were you well prepared?
FBE: Although we were surprised, like many, by the scale of the consequences stemming from the health crisis, we very quickly took the appropriate measures to deal with it.
In view of the situation and the decentralized nature of our organization where we are present in many countries, a monitoring and follow-up department complementary to local departments was set up at a Group level. Still effective to this day, we interact with local entities who are facing difficult decisions, in particular regarding the health and regulatory requirements of their countries.
Has the crisis strengthened the role of the Risk Manager within a company?
FBE: Beyond the Risk Manager, risk management throughout this crisis has helped companies to better understand the risks they were facing and to manage them more efficiently and safely. Risk management has proven its added value as a result of this crisis: to organize monitoring strategies that will provide the necessary information for effective decision-making, to develop a risk map in order to anticipate and reduce risks, to prepare and organize crisis management and feedback and adapt risk financing etc. It is clear that the companies that have suffered the least are those that have been able to put in place the appropriate tools, especially including effective risk management.
Has the function of Risk Manager today thus become a real pillar in the business ecosystem?
FBE: Certainly, but the role is still reserved for companies of a certain size as well as certain smaller companies carrying out a 'risky' activity by definition. If the function does not exist within the company, the risk management will be taken over by the leaders, which allows them to structure and secure their resilience. This crisis has highlighted the value of investing in risk management.
What are the new challenges that the Risk Manager must face?
FBE: Our main challenge is to support companies in an increasingly complex world on multiple levels, such as digital, societal, geopolitical, the list goes on. Many of them have had to rethink the way they interact with their customers and their ecosystems, for example through a digital transformation, started or accelerated as a result of the pandemic. More and more of them want to integrate sustainable development into their strategy. The Risk Manager must therefore be able to take all these aspects into account in the company's risk management and financing policies, to secure effective decision-making and the resilience of the organization.
You are also AMRAE's vice president for digital transformation. Can you tell us more?
FBE: AMRAE has 1,600 members spread across the country and also a few abroad. The pandemic is an exceptional situation where we have adapted the way in which we work together, notably through strengthening the efficiency of our digital tools. Commissions and working groups have come together to conduct brainstorming workshops or webinars.
We have also reinvented our annual conference, 'Rencontres du risk management' which could not be held in person this year, by offering two days of online conferences, accessible to all, free of charge, which allowed us to expand our audience and to disseminate the principles of risk management more widely. The amrae.fr website has also been redesigned for greater clarity with richer content that is easily accessible to our members.
We are also developing new operating methods to interact with our members in the regions. The objective is to simplify and energize animation at national and regional levels thanks to digital technology.
The year was not only marked by the health crisis, but also by the significant number of cyberattacks. How do you interpret this risk?
FBE: The cyber risk has grown even further, particularly due to the massive use of teleworking, the acceleration of digitization, leading to the increase in the number of attacks. At an AMRAE level, we've been working on these issues for a long time, long before the crisis. At the end of 2019, we published a guide - Controlling Digital Risks, the Trust Asset - co-written with Anssi.
We are also launching the Lucy project (Light on cyber insurance) to establish an objective and recognized benchmark for the state of the French cyber insurance market. The goal is to eventually obtain an offer more suited to the needs of companies of all sizes, whether in terms of guarantees, limits, or operating procedures.
The cyber insurance market is booming. Do you think that what insurers offer is adapted to the needs of businesses?
FBE: The market is actually different depending on the size of the business. Large companies will move towards tailor-made insurance solutions, while smaller ones will turn to standard guarantees that suit them. Although products on the market are interesting, particularly in that they generally offer an incident response component and an indemnity component, some companies may encounter difficulties in structuring certain insurance limits, in particular when some insurers tend to reduce their level of commitment. Other companies will encounter difficulties in putting guarantees in place which are adapted to their risk profile. Finally, insurers have shown apprehension about renewing the most up-to-date insurance cover, leading to a sometimes complicated dialogue between insured and insurer.
What are the other main risks that businesses may face today?
FBE: They are numerous and evolving. For example, a 'cyber pandemic' is a risk that could emerge over the next few years, as companies become more and more digital. It could materialize in the form of a systemic cyber risk affecting the communications infrastructure, service providers, and the cloud, so that many companies around the world would be directly affected by a failure of one of their providers. In addition, there are risks linked to geopolitical developments, social and societal tensions in a number of countries, as well as risks linked to climate change and the rise of natural disasters. Other risks are more dependent on the sector.
How can companies protect themselves against these risks?
FBE: Investing in risk management allows you to anticipate risks. This makes it possible to put in place many actions to structure a company's resilience, which guarantees its performance over time. AMARAE has put in place tools, some of which are free and accessible to everyone, in particular giving SME and mid-market managers the opportunity to map risks and thereby better prepare for future crises. Now more than ever, risk management has proven its added value and relevance: when risks are managed, the company is sustainable.