Risks And The Boardroom

Are you rearranging deckchairs on the Titanic? Taking corporate risk management seriously

Are you rearranging deckchairs on the Titanic? Taking corporate risk management seriously

I travelled from Tashkent to Moscow on an Aeroflot Ilyushin 86 in the early 1980s. The seats were basic metal framed deckchairs, screwed to the floor1. Why don’t airlines nowadays use simple deckchairs on airplanes, instead of very heavy, crash-resistant ones? The fuel saving alone would be enormous and the temptation, especially to low cost carriers, must seem overwhelming. The answer is obvious, I hear you say; safety. But airlines spend...

How a bow-tie can smarten up corporate risks

How a bow-tie can smarten up corporate risks

Imagine that you are worried about your infirm mother and want to make sure that you do everything to protect her. If you adopted typical corporate risk management practice, you would identify a risk that she falls over. You would then calculate the impact (maybe a broken bone) and then identify some mitigations, such as putting some cushions around her bed or installing a handrail. All sensible, but not very through. What if the consequence...

Why you might want a pilot running your Risk Committee

Why you might want a pilot running your Risk Committee

There’s a saying in aviation: ‘Never fly in the same cockpit with someone braver than you’. Risk management for a pilot is literally a matter of life and death. Have you ever asked yourself whether you would share a boardroom table with executives braver than you are? Company risks are often presented as long shopping lists; each with a reassuring comment, about how it’s unlikely but that it’s covered off. A typical audit committee, and now the...

Why you wouldn’t want a CEO piloting an airliner

Why you wouldn’t want a CEO piloting an airliner

The popular image of a pilot is of a dashing hero, who pulls off amazing feats of skill to save his aircraft from imminent disaster. However, in reality, what airlines value most in pilots is keeping to procedures and operating according to checklists, acting with defined responses to various planned and unplanned events. That’s not to deny that pilots possess considerable skills and knowledge. It’s just that these are best deployed in known...

Why aviation is safer than the boardroom

Why aviation is safer than the boardroom

The basic model of commercial aviation is a thin tube of highly pressurised metal being propelled at 600 miles per hour by inflammable fuel at 35,000 feet in all weathers at temperatures of -57 degrees. So have you ever wondered how aviation got to be one of the safest forms of transport, despite being inherently full of such potentially catastrophic risks? On the other hand, the average boardroom, comfortably at 20 degrees, often going...

‘Not missiles, but microbes’ – Why didn’t we see it coming?

‘Not missiles, but microbes’ – Why didn’t we see it coming?

Famously, in 2008, the Queen asked economists why no-one saw the great financial crisis coming, not least as they were giving her a full retrospective inquest into why it happened1. She might well ask the same question again now about the COVID-19 pandemic. Of course, some commentators did predict the likelihood of a similar pandemic. Bill Gates, not a renowned epidemiologist, in 2015 said; “If anything kills over 10 million people in the next...