The risk manager position is responsible for the monitoring and mitigation of all risks within a company. The position usually reports to the chief financial officer, but may also work closely with many parts of the company, including:
Legal and accounting
Safety and health
Thus, the risk manager position should be considered a mid-level management position.
In general, the risk manager should be thoroughly versed in the industry within which the company operates, as well as the facilities, processes, and products of the company. He or she should also have a detailed knowledge of prior accidents, lawsuits, and claims, and the reasons for those incidents. The risk manager should also be cognizant of risk issues that have impacted other companies in the industry, and explore whether those issues could impact the company at a later date.
In more detail, the job description of the risk manager encompasses the following:
Determine the nature of all risks to which the company is subjected, and monitor operations to spot changes in these risks
Monitor the probability of loss from all types of risks
Ensure that the company is in compliance with all government regulations relating to its insurance coverage
Design methods for the mitigation of losses, such as through outsourcing of operations, changes to work instructions, or the procurement of insurance
Manage relations with all insurance providers
Maintain records relating to all incidents and insurance claims
Evaluate new risk management techniques and recommend them to management as appropriate
Present the risk profile and risk mitigation plans to the board of directors at regular intervals
A more successful risk manager should be able to estimate the financial impact of certain risks if they come to pass, and convey these projections to senior management. Doing so can have an impact on the amount of funding allocated to risk management activities, and may also convince management to avoid certain strategic alternatives due to their risk profiles.