Actively managing risk culture in energy firms: part one

Risk culture lies at the root of many of the most publicised energy risk management failures. In the first instalment of a two-part series, Carlos Blanco, Jean Hinrichs and Robert Mark explore how energy firms can define, assess, benchmark and actively manage risk culture

Interest in the risk culture of organisations has increased dramatically in recent years. During that time, research, studies and broad discussions on the importance of risk culture have proliferated across the world.

Risk culture is often ‘the elephant in the room' behind many risk management failures, such as those shown in figure 1. To enhance firms' level of risk awareness, boards and senior management should periodically assess the risk-taking culture of their organisation in order to