Stock illustration: Pencil drawing a bridge for people to cross. Credit: freshidea/Adobe Stock

Businesses around the world have experienced a wide array of shock events in the past few years—from escalating cyberattacks to the pandemic’s human and economic turmoil, to supply-chain problems ranging from the predictable to a key global trade route being blocked by a megaship. Together, these events serve to highlight the importance of a risk management battle cry: Resilience matters.

Organizational resilience consists of several characteristics. A resilient company responds to, and recovers quickly from, events while minimizing losses. It anticipates upcoming threats and forecasts their prospective impacts. And a resilient company integrates risk planning into strategic decision-making throughout the organization.

Building resilience requires companywide commitment and coordination. Too many organizations relegate the treasurer, or even the CFO, to the sidelines of these processes. That is a mistake. Treasury and finance teams can and should play a strong, vital role in building corporate resilience by helping other functions incorporate risk management considerations in their day-to-day operations, as well as short- and long-term planning.

 

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