The Fractional CRO: Rethinking Staffing in Light of Increasing Risk Velocity
Over the past years, companies have faced a number of economic, global, and competitive risks that have accelerated the need to establish proportional Governance, Risk, and Compliance programs to meet the needs of the changing environment they operate in. From the Covid-19 pandemic to the Russia-Ukraine conflict, from the global rise in cost of capital and resources to changing regulatory requirements including new topics such as ESG and DEI, companies are dealing with a significant increase in Risk velocity. As companies have to understand internal and external risks affecting their organization at a faster pace, risks are also becoming more complex and interconnected. The Global Risk Landscape 2023 report by BDO highlighted this as 63% of respondents believe Risk velocity to be increasing and 48% agree that they are more interconnected, creating more emphasis on proportional Risk Management. The same survey also noted that firms with a CRO are 7.3x more likely to welcome Risks and utilize Risk Management and Risk Intelligence as a strategic advantage.
Companies are responding to this need by hiring Chief Risk Officers (CROs) and building out Risk Management teams thereby competing for a finite resource pool of Risk. 82% of the financial services companies surveyed by BDO state that they have hired a CRO and most large financial services firms have additional hiring plans based on job posting activity. This response combined with a historically low unemployment rate in the US creates a highly competitive market when looking to hire experienced Risk leaders. Here is where the concept of a fractional CRO and fractional Risk team comes in. Hiring an experienced CRO or risk leader less than full-time (fractional) provides companies with Risk experts at significantly improved economics compared to a full time Risk Leader. In addition, fractional Risk leaders bring cross-industry and cross-company experience to the client, enabling a scalable Risk Management Framework that provides actionable Risk Intelligence. Here at Clarendon Partners, our Fractional Risk leaders help companies scale and provide insights and mentorship based on their multi-faceted been there, done that experience. A fractional CRO is part of the company’s team working side-by-side with them to deliver a proportional Governance, Risk, and Compliance program based on their size, maturity, and Risk Appetite, while at the same time creating staffing flexibility, increasing effectiveness, and ensuring your company’s competitiveness.
It’s Time to Evolve
At Clarendon Partners we help our clients by providing fractional Risk Leaders with deep Risk expertise gained in Big 4 Consulting or as CROs in industry. Our Risk experts are here to help you evolve!
Contact us at digital@clarendonptrs.com to discuss how we can help.