A chief risk officer is a high-level executive responsible for the assessment and mitigation of significant threats to an organisation’s capital and earnings. These threats may be competitive, regulatory or technological in nature. These professionals are essentially responsible for managing the overall risk profile of an organisation. What does a chief risk officer do?
Job Profile
A chief risk officer, or CRO, occupies a leadership role in a company and is tasked with various responsibilities such as analysis and mitigation of risks that could impede business growth.
Businesses have, for so long, been threatened by risks that can damage both profitability and productivity. The role of a CRO is therefore an important one in the C-level hierarchy.
Chief risk officers are typically concerned with issues such as:
- Insurance
- IT security
- Compliance
- Financial auditing
- Fraud prevention and more.
Chief Risk Officer: Responsibilities
A chief risk officer is in charge of evaluating a company’s risk by monitoring regulatory, technical and competitive factors. They then implement policies and procedures to ensure that management operational risks are minimised.
They determine and evaluate a company’s risk tolerance and create strategic plans to mitigate risk.
The CRO also ensures that the organisation complies with regulations and laws that govern its internal processes, external engagements and sales.
Chief risk officers generate reports on a company’s risks and risk management initiatives and are tasked with distributing them to employees, executives and stakeholders.
What are the duties of a CRO?
- Evaluate company’s risk by monitoring regulatory, technical and competitive factors
- Implement policies and procedures to ensure management operational risks are minimised
- Determine and evaluate a company’s risk tolerance
- Create strategic plans to mitigate risk
- Ensure that the organisation complies with regulations and laws
- Generate reports on a company’s risks and risk management initiatives
- Distribute reports to employees, executives and stakeholders
- Quantify risk limits
- Monitor the progress of risk mitigation activities
- Oversee funding and budgeting of risk management and mitigation projects
Find the right CRO for your business here
Chief Risk Officer: Skills
A chief risk officer has a strong understanding of corporate technology systems, networks, IT infrastructure and cyber threats.
They have strong analytical skills in order to be able to evaluate risks and develop strategies to mitigate risks for a company. They also have excellent strategic planning and leadership skills as well as basic finance and accounting skills in order to understand the impact of various risks on the company’s budget and revenue.
CROs also have excellent communication and organisational skills and have the ability to respond to security issues promptly.
Skills of a CRO:
- Strong understanding of corporate technology systems, networks, IT infrastructure and cyber threats
- Strong analytical skills
- Excellent strategic planning skills
- Strong leadership skills
- Basic finance and accounting skills
- Excellent communication skills
- Strong organisational skills
- Ability to respond to security issues promptly
Background and Education
A chief risk officer typically has a Bachelor’s degree in accounting, business administration, or economics. And since the CRO job is a high-level executive position, it will require candidates to have extensive experience and proven business, managerial and interpersonal skills.
Many companies may also seek candidates who have a Master’s in business administration.
You can also improve your chances of landing high-paying jobs by seeking training through online courses. Check out options for these down below:
- Managing Risk and Reputation in a Complex World
- Risk Management Specialization
- FinTech Risk Management
- Financial Engineering and Risk Management Specialization
Salary of a CRO
A CRO earns approximately $272,000 per year on average. On the lower end, these professionals can earn around $193,000 per year whereas on the higher end, they can earn around $359,000 per year.
In Germany, CROs can earn between €128,000-€201,000 whereas in the UK, they can earn between £136,000-£380,000.
Keep in mind that these numbers can vary depending primarily on the industry you’re in and the skills you have.
How much do chief risk officers make?
| US | $193,000 – $359,000 |
| Germany | €128,000 – €201,000 |
| UK | £136,000 – £380,000 |
