For the past year, the Covid-19 pandemic has been redefining how companies manage risk. The rapidly changing business environment has led to ever-increasing risk velocities. Companies' exposures are in flux, and new risks are emerging more and more frequently. In this environment, traditional organizational structures—with risk specialists in one department, compliance in another, and silos of additional risk professionals spread across different lines of business—have proven ineffective.

As a result, the Committee of Sponsoring Organizations of the Treadway Commission (COSO), a highly influential risk management thought leadership organization, recently issued guidance for companies to create closer links between compliance departments and risk managers who focus on an array of corporate hazards. This underscores the widespread need for companies to unsilo risk functions and create an enterprise risk management (ERM) program.