In This Chapter
Understanding risk management goals
Working with professionals on reports
Reporting to the board
Making use of feedback
Financial risk management is all about reporting and communicating. I discuss these responsibilities in nearly every chapter, but in this chapter, I deal with the formal, top-level reporting financial risk managers must do to boards of directors and in annual reports and similar circumstances.
Appreciating the Role of Risk Management
The modern field of financial risk management is less than a quarter century old, but the subject of this chapter – reporting on risk – is an ancient and essential part of finance. Textbook definitions of finance often centre on money, or markets or securities; but these are limited views. Finance is a way of organising human activity. Money, markets and securities are merely useful tools in this endeavour. You can do good finance without any of them, and you can most certainly use all those tools without doing good finance. On the other hand, you cannot do good finance without honest and accurate ...