The Gate is an operational framework for information and expertise sharing between K-Companies
Enterprise Risk Management is an essential and valuable methodology for identifying, quantifying and mitigating risks to develop and manage plans related to reducing potential corporate losses. Historically, risk management has been limited to studying risks of natural disasters, with insufficient attention paid to intangible and unforeseen risks, which has taken a heavy toll on companies.
Hence, the importance of implementing risk management policy has been highlighted as it has a substantial role in supporting companies and helping them to identify visible and hidden risks, which affect projects. After identifying risks, companies try to reduce their potential impacts, in accordance with global standards.
It is from this vantage point that KOC, represented by the Enterprise Risk Management Team of the Management Support Group, has established a communication plan for KPC and its subsidiaries titled "Communication Gate", to manage risks. The plan provides a practical framework for sharing information and expertise on topics related to enterprise risk management in a sophisticated and intelligent manner.
Enterprise Risk Management (ERM) has been established in KPC and K Companies since 2008 onwards and has now reached stage 4 of ERM excellence model. The ERM 2040 strategy is the enabler to the next level. KOC is tasked to develop and lead the ERM communication plan across KPC and subsidiaries. Communication is the overarching element covering all steps in the ERM Framework. The ERM Communication plan is designed to not only enable an effective implementation of the framework, but also help innovation and development of the ERM Process and provide the foundation for competitive advantage by integrating business strategy with ERM. Many elements of the communication plan already in place while some others need to be developed further.
In this context, KPC focuses on a set of objectives to be recognized as a leading enterprise risk management practitioner amongst energy companies. At the same time, KPC strives to integrate enterprise risk management into its core business and that of its subsidiaries. Furthermore, it endeavors to influence ERM practice with its business partners to ensure the optimal balance of risk and reward whilst pursuing its objectives.
The Communication Gate aims to enhance corporate-wide risk culture, awareness, and knowledge of risk management, with a view to ensuring wider and balanced exchanges and valuable expertise between K-Companies. It demonstrates management commitment by effectively improving risk management in the decision making process and promote culture of risk management inside KOC .
Based on KPC's and subsidiaries 2040 strategy, which also covers this strategic risk management vision, several presentations on identifying business risk preparations were shared and procedures were clarified to minimize or eliminate risks, thereby improving the performance of business in a thoughtful manner.
Strategic Objectives
As for oil sector ERM 2040 strategy, it includes several objectives, as follows:
- Enhance corporate-wide risk culture, and skills of risk management.
- Demonstrate management commitment by effectively enforcing risk management in the decision making process throughout KPC and maximize its integration.
- Develop a highly skilled and motivated ERM workforce.
- Enhance and support ERM eminence building program and promote the global presence of KPC and subsidiaries as leaders in ERM.
Communication Plan Objectives
ERM communication plan includes several objectives, as follows:
- Improve effectiveness of ERM by enhancing ERM communication through K-Companies and improving the risk awareness culture.
- Provide the right information at the right time to influence the norms of behavior for individuals and groups within an organization that determine the collective ability to identify, understand, openly discuss, and act on the organization's current and future risks.
- Build awareness of ERM among a wide but defined group of audiences and user groups.
- Secure the commitment of a defined group of stakeholders to ERM aims.
- Influence specific policies or policymakers around key aspects of ERM.
- Encourage participation among all stakeholders.
- Executive Management/Leadership should communicate to each company frequently. This could be done through effective business guidelines, leadership corner, speaking in K-Companies events, and briefing ERM Team on KOC CEO brief.
"Risk Management Community" Network
In a separate but supportive initiative, the Enterprise Risk Management Team has established an external network for the Enterprise Risk Management Community in March 2018. The network can be used as a social collaboration platform to find subject matter experts (SMEs) and share knowledge and information regarding work and business projects to connect ERM experiences.
Features:
- Share ideas and collaborate effectively.
- Interact with others professionally.
- Send important announcements related to events and workshops.
- Participate and engage more.
- Import valuable documents related to ERM business.
- Access from multiple devices like tablet, and smart phones.
- Share, like, follow and stay more connected with ERM members.
Well-established Culture
Speaking of enterprise risk management in the Company and the oil sector as a whole, it was necessary to shed more light on the vision of senior officials, as this clearly shows the priority it has in the Company's culture.
Supporting ERM culture
DCEO, Planning and Finance, Bader Al-Attar, maintained that promoting the culture of risk management is part of KOC strategy and the oil sector as a whole, as it helps to achieve the objective of identifying and reducing risks.
"I am fully prepared to support and promote ERM culture in all KOC Directorates, in order to boost performance and keep up with global companies," he added.
Al-Otaibi: Keeping up with latest developments
Manager, Management Support Group, Dr. Musleh Al-Otaibi, said that the overall risk management strategy is focused on processing and risk preparedness, through planning, organization and leadership, with a view to minimize repercussions that might threaten the capital and profits of the Company, as well as other challenges. This would ensure that the best services are provided to KOC efficiently and effectively.
Al-Otaibi pointed out "KOC is constantly evolving in this respect, and is keen to keep up with the latest developments in the field of technologies and methodologies. By this, it aims to enhance the role of enterprise risk management, in order to hold a leading and prominent position in the oil sector."
Al-Ajmi: No accomplishments without communication
Team Leader, ERM, Rakan Al-Ajmi, said: "An individual cannot work on his own and deliver without communicating and teamwork. So, what about a well-established company like KOC, which is the backbone of the economy of the Stata of Kuwait." Al-Ajmi expressed his pleasure being a team leader in KOC to promote the culture of enterprise risks, help to demonstrate management and employees commitment to implement risk management procedures effectively. This can only be achieved through supporting the Company to take the right decision and achieve it strategic objectives in well-researched and thoughtful steps.