GC: We do have to recognise that risk management can be undervalued still in France as elsewhere. It is an integral part of management and at the same time very much linked to the financial department because you cannot consider risk management without looking at what needs to be done to mitigate and respond to risks and devise action plans to resolve risk challenges. This is intrinsically linked to the financial management of a company if only because insurance is a key tool and one of the financial lines. At the end of the day the core function of risk management is to protect the balance sheet of the corporation. A recognition of this fact is one of the reasons why the profile of the profession has improved and more people are understanding the value that risk management can create.

GL: And this is also of course thanks to our predecessors at AMRAE. We had a wonderful opportunity to enjoy the leadership of people like Thierry Van Santen and Pierre Sonigo who understood much earlier than others the significance of risk management and what it could become. Thierry came from a technical insurance background at FM Global but became a leader of risk management as a governance tool in Europe. Pierre Sonigo also came from a technical background and has become one of the top leaders of the profession in Europe too. Olivier Sorbat was a financial expert who promoted a lot of ideas. We have enjoyed a long generation of French pioneers in this profession and at AMRAE.

AL: Do you think the French way of doing business is more naturally suited to risk management than perhaps the Anglo-Saxon style?

GC: Many of our groups have international operations and therefore this is maybe why we took the issue of risk perhaps more seriously at an earlier stage than some countries. If you look at the current leading French companies they all have big global operations and this is maybe why we are so open to risk management.

GL: But again do not underestimate the work and effort of various individuals who have promoted the profession over the years through AMRAE and moved the discussion onwards through discussion and debate not least through the Rencontres which has been a great success. And I would say that during my time at AMRAE it was a very good idea to redirect the Rencontres so that it took advantage of the fact that it had become a true meeting place for everyone in the industry and a unique place to network with colleagues and service providers. It was important to offer the service providers an opportunity to more formally enter the conference.

GC: It is a good combination whereby it now acts as a business forum to meet and network with all in the market but also still delivers ever better content through the workshops. To maintain this level of quality is our commitment and goal. We have to ensure that the Rencontres is a chance to rise to new challenges and questions and work together to tackle new issues.

GL: Yes I believe we have found the right balance between what we can provide in terms of technical expertise and what others can bring such as insurers and brokers. We are very happy to have found this balance, to enable risk managers to talk and to listen.

AL: What about the membership levels? Are you happy that you are now reaching all risk managers with leading French companies and what is next? Do you plan to reach out to smaller companies like many of the insurers and brokers are doing and how can this be done as many of these companies do not have dedicated risk managers or even insurance managers?

GC: This is one of the goals that will be announced at the conference this week. We want to extend out to the medium-sized sector. We believe that we represent all risk managers with all the major French companies but risk management is relevant to all businesses and so we want to spread this message about the value of risk management to all the other companies. It is vital for example when a smaller company wants to work with a big company they have to demonstrate that they are compliant with the risk management standards of the company and all the relevant rules. Therefore we would like to take a tool kit to medium-sized companies that is an adaptation of what we do at the larger companies. This is a major goal for 2012. We will do this by going out into the regions of France, working with local universities and the like.

GL: This is vital because smaller companies are subject to the same rules as the big ones and are obliged to apply these rules. AMRAE can help such companies apply the rules. And remember that this is about added value not just compliance. Typically a CFO or general manager is very happy after discussing risk management with us and it often leads to very interesting discussions.

AL: What about younger risk managers—is there plenty of supply of young people who want to join the profession in France?

GL: There are plenty of young people to meet demand thankfully. Most of the top French schools have now developed risk management masters focused on international risks. Today we work closely with other associations in relevant fields and colleges so ‘supply’ of new talent is thankfully secure.

AL: What about you two—how is the new partnership and structure working at AMRAE?

GC: It works very well and is not a big challenge. The big challenge is to manage the development of AMRAE as an organisation and continue our international growth and strengthen our links and relationships with other organisations. This is a big job and for me it was not possible to accept the role of chairman without the support of a director general. For me this was critical. I knew the association of course as a member and have experience of managing my own association (CREAFI) but did not have an inside working knowledge of AMRAE and so it has been incredibly useful to have Gérard at my side and his knowledge. It is the same structure adopted by RIMS, Airmic and Ferma and it makes sense.

GL: We came to a point where we realised it was necessary to reinforce the governance of the association to help achieve the goals of the members. We discussed the possibility very early on, a year ahead of the change, about the potential changes to the governance of the association. It was not about people but what was best for the association.

AL: What do you regard as the big three risks that face AMRAE members and risk managers throughout Europe and internationally in the coming year?

GL: The first big one I see is counterparty risk such as credit and the question of whether counterparties will be able to honour their commitments. Will banks and other funding bodies be able to provide the finance companies need and will insurers be able to continue to offer the quality of coverage needed by industry. Then there is cyber risk. I am not just talking about the big question of fraud but also how individuals and companies behave and how they use things like social networks. It is not just about hackers but also about the use and abuse of such tools to spread information and misinformation. The cloud is a difficult place to protect for example. Then there are natural events. There seems to have been a change in scale and the nature of the impact. We had the big earthquake and tsunami in Japan and the floods in Thailand which revealed the vulnerabilities caused by global interdependencies. Will insurance companies be able to provide capacity for such risks to the extent required by companies?

GL: I agree that lack of financing and liquidity is a big question and also the state of the economy as a whole at a state level and at company or consumer and individual level. If we fail to finance further growth and development then we are in trouble and there are big questions about the breakdown in state finances. Second I see the disparity of wealth and revenue across the world as a big issue. This was one of the reasons for the Arab Spring. Wealth disparity and health disparity will become more of a focus as some countries are developing very quickly and this can heighten rather than reduce the disparity. Then there is reputation. Access to information is much larger and the information spreads far quicker and can spread across the world very quickly and of course it is not always reliable and very difficult to correct or control. So reputation is a very tough risk to manage today.

GC: For all these points there is a change of scale. Events occur at a super-fast pace and are bigger than before. This means that risk is basically of a greater scale and so presents a greater management challenge. 

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