Running with risk

It’s good to take risks—if you manage them well.

Source: McKinsey Quarterly

Risk is what ultimately creates shareholder value, at least when it doesn’t destroy shareholder value, so managing risk should rank among the core activities of any business. Yet as a McKinsey Quarterly article pointed out back in 2003, “the corporate meltdowns of recent years suggest that many companies neither manage risk well nor fully understand the risks they are taking.” They need to develop what the article calls a risk culture—not a culture that glorifies risk but one that reviews, understands, and controls it. To learn about the four elements of best-practice risk management, read more>