It is important for any sector to have a system that effectively manages assets as well as risks. This is particularly true in the financial sector, as insurers invest the premiums they receive from policyholders into assets to generate income and maintain solvency. Assets are volatile, so it is vital that investors are able to manage their investments effectively. This means knowing when to take on more or less risk to reach their goals.
In addition, an effective process for managing risk and assets is vital for energy and resource companies to safeguard their assets and achieve the highest ROI throughout their lifespan. This means the identification, assessment, and assessing the risks associated with the assets of an organization that include tangibles such as buildings and equipment and intangibles such as intellectual property and data.
The business must first determine and name all of its assets. Ideally, each named asset should have a person in the organization who has oversight and responsibility over it. They are aware of the risks that are associated with their assets and can reduce those risks effectively. These individuals should be consulted by the risk management department to evaluate the potential threats and vulnerabilities.
From there, a company must prioritise the identified risks. This is usually according to the probability of the risk arising and its impact on the business. Priority risks must be given the greatest attention, investing in security, and implementing it. The other risks should be addressed if needed while considering the company’s operational requirements and regulatory compliance.