A risk manager helps to assess potential risks and then advise on how to avoid or reduce those risks. They can be involved in identifying, evaluating and reporting risks to various parties. This could include underwriters, loss adjusters and senior members of staff.
In this article we look more closely at the role of a risk manager, what they do day to day, where they work and the routes into the profession.
What does a risk manager do?
Essentially, risk managers ensure that effective frameworks are put in place to deal with risk and ensure compliance with legal requirements.
They advise organisations on the potential risks to the profitability or existence of the company. They then decide how to avoid, reduce or transfer the risk and put plans in place for if things go wrong.
As a risk manager you will work for one company, and will be in charge of managing the risk for that organisation. This includes everything from their employees, reputation and stakeholder interests all the way down to customers.
What does a risk manager do day to day?
Your role as a risk manager will be varied and will involve a range of activities relating to risk. Some tasks may include;
- Carrying out risk assessments and evaluations
- Reporting risk to different stakeholders
- This could include a board of directors to members of senior staff to ensure they understand the risk related to their side of the business
- Implementing risk management process
- This could include purchasing insurance, carrying out health and safety measures and making contingency plans
- Conducting audits to ensure standards are being met
- Providing support and training to staff to build risk awareness
More specific tasks will depend on the industry you are working in and how specialised your role is.
Where does a risk manager work?
Risk managers are found in a variety of industries, more predominantly in the banking and financial sector but can also be found in the following areas;
- Infrastructure (this could include working on projects such as bridges, tunnels or railways)
- Healthcare sector (such as working in pharmaceuticals)
- Energy sector
So there is a real chance to work in an industry that interests you.
How much can a risk manager make?
The role of a risk manager is not an entry level one, which means that salaries can vary depending on your experience level.
Starting as a risk technician, you can look to earn around £21,000 which will rise with experience. As a risk analyst you can earn around £44,000. Risk managers can earn up to £74,000 and over.
Salaries can vary depending on the company you work for, the sector you work in or if you specialise in a particular area.
How do I become a risk manager?
Degrees in economics, finance or management may increase your chances of going into risk management. However, there is no requirement for a specific degree.
There are specific risk management degrees that are available to you, therefore it is worth doing your research if you think that this career is right for you. Postgraduate degrees are also available which could be advantageous.
You can get into risk management if you do not have a degree. This will more than likely be in an administrative role then progressing into a risk assistant position. After that you will be able to work your way up to a managerial position.
It is also possible to enter the profession as a trainee risk analyst at a brokerage. Risk management does also attract mature entrants with commercial or insurance sector insurance. In fact, some companies ask for as much as five years of underwriting experience.
If you want to enter risk management you should do your research into individual companies to find out their requirements.
Becoming a risk manager is a hugely interesting and rewarding career. There is the opportunity to work in an industry that really interests you and the chance to make a difference to a company.