If HR and Risk Management were single people looking for meaningful relationships and stumbled across each other on Tinder, they would probably swipe left and move to the next potential match. What they don’t realise is how compatible they are. They are both dog people, they love to keep fit, travel, cook and both believe they have a great sense of humour.
Risk and HR are evolving. They are moving into each other’s territory, so they’d better get ready to have grown up conversations about how they are going to make that work. In fact, within a few years I expect to see HR and Risk merge into the one function. And when they do, this will be the making of the HR profession, which has often struggled for impact. It will also see the humanising of risk management.
The overlap is culture. And if there were any confusion, Australia’s Hayne Royal Commission clarified beyond doubt that risk management must learn new skills to asses risk through the interaction of governance, culture, leadership and decision making.
Progressive risk leaders have already introduced the topic of Risk Culture. That is entirely appropriate. But don’t be fooled. Risk Culture is Organisational Culture. If your conversations are focusing on different things, then either your risk settings or your HR settings are wrong.
The legacy of the merging of these professional disciplines will be that better measures of culture will emerge. Today, the measures of culture are quite woolly. Our inability to describe culture is the first problem. Not that there isn’t a raft of great academic literature on the topic. It’s just that even when culture is defined, it generally isn’t measured well. And if not objectively measured, then efforts to change culture are abandoned the moment the current crisis passes.
The reality is that improving organisational culture and managing risk through better governance and decision making is not only hard to measure, it is hard to do. It takes time. It is about changing the collective psychology of the people in an organisation. It also requires an organisation to be clear about what it wants as the outcome of its efforts, and not just clarity about what it doesn’t want to be.
What is our appetite and tolerance? What do we do check? What are the consequences?
The moment has arrived risk and culture professionals. Don’t blow it!