Ulrich Hommel, Managing Director and Leader of the XOLAS Risk Management Practice, has published a thought-provoking article on how to organize risk management more effectively in business schools. It has appeared in AACSB Insights.
Summary: Business schools are paying more attention to risk than ever before, especially now that Standard 1.2 in the 2020 AACSB Business Accreditation Standards asks schools to “conduct formal risk analysis and … mitigate identified major risks.” The COVID-19 pandemic made it clear that such analysis is essential to an institution’s long-term survival. Nevertheless, many schools are only beginning to design state-of-the-art risk management systems that measure up to those used by business organizations. What are the different pieces of the puzzle that, together, provide a tool academic leaders can use to better predict risks and prepare for crises? This article defines 10 principles of good risk management—and point out common fallacies that can limit the effectiveness of risk management programs.