The role of the Chief Risk Officer (CRO) is becoming increasingly important within the insurance sector. The financial crisis in 2008 and the subsequent economic turmoil have put risk management at the top of the corporate agenda. Reviews of corporate governance and the imminent introduction of the Solvency II regime have driven changes in the European insurance sector. The CRO is now typically a key member of European insurers’ leadership teams. In our latest ERM survey, most companies(84%) have appointed or intend to appoint a CRO or equivalent.
Nevertheless, the role of the CRO is still in its relative infancy and in many cases is still evolving. In our experience, many insurance company Boards continue to debate the real focus and purpose of the CRO in the company. Views amongst CROs are also mixed about their satisfaction with their roles; some are finding their roles stimulating and rewarding, whilst others appear to be finding it difficult to see how their role is adding value.
To gain a deeper insight into CROs’ views on their roles, Towers Watson recently carried out interviews with a number of CROs from various insurance companies across Europe. The objective of these interviews was to gain additional information on the focus of their role; their opinion on the changing nature of the role and the challenges ahead.