It is essential for every industry to have a method that effectively manages assets and risks. This is especially true in the financial sector, where insurers invest the premiums they collect from policyholders into assets to generate revenue and ensure the viability of their businesses. Assets are volatile, which is why it is important that investors manage their investments well. This includes knowing when to take on risk or take a lower risk in order to achieve their goals.
A solid asset and risk management system is also essential for energy and resource businesses to safeguard assets and increase ROI over the course of their lifetime. This involves finding, assessing, and addressing the risks associated with the assets of an organisation that include tangibles such as equipment and buildings as well intangibles, such as intellectual property and data.
A business must first identify and name all of its assets. Ideally, each named asset should have an owner within the organization that has oversight and responsibility over it. These individuals know the risks that are associated with their assets and are able to reduce those risks effectively. The risk management department must work with these stakeholders in order to determine the risks and vulnerabilities that could be present.
The company can then decide on the most risky risks to be a priority. This is typically based on the probability of their occurrence and the potential impact of each risk on the business. The highest priority risks should receive the greatest security implementation, investment and attention. Other risks need to be addressed according to the business’s operational requirements and regulatory compliance.