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mismanagement was the moment in corporate history which defined the need
for urgent change and ushered in a new era to corporate governance and stra-
tegic risk management. It highlighted the need for a review and reappraisal of
corporate behaviour and accountability. In turn this had major implications for
sustainable risk management.
Therefore the book concludes with some analysis and comment on the
comparative responses to the Enron case study, with some recommendations
based on the need to consider emerging risks in emerging economies that are so
rapidly taking place at the forefront of globalisation.


Overview of emerging SERM risk issues
Risk issue Role (and expectations) of business?

Economic risks
Economic crime (Chapter 7) Bribery and corruption “ responsible procurement
and governance procedures
Systems to prevent fraud and money laundering
Business interruption risk (Chapter 8) Disaster and act of terrorism recovery programmes
and contingency plans in place
Stakeholder value and reputation risk Defining the value of your reputation and
(Chapter 9) protecting this intangible asset
Business and marketing practices Political agendas, public/private partnerships
(Chapter 10)
New technology (Chapter 11) Access to technology (internet and computers)
Use of technology/training/engagement
Social and ethical risk
Business culture practice (Chapter 13) Education and access to mentoring, capacity
building and training
Change management risks
Human rights in the workplace Employment law and confronting discrimination
(Chapter 14)
Human rights outside the workplace A realisation of the issues surrounding poverty
(Chapter 15) and inequality
Community relations and investment: generate
secure employment; provision of food, shelter,
healthcare, education and training; loans, micro
credit; promote access of local services/products;
staff involvement in the local community;
partnership development
Avoidance of forced, slave or child labour
Labour translocation and outsourcing
(Continued)
Handbook overview xxxi




Risk issue Role (and expectations) of business?

Health and safety in the workplace Access, infrastructure for provision of health
(Chapter 16) services for staff
Workplace disease prevention
Provide adequate health and safety awareness pro-
grammes
Gaining of standards ISO 18000 series
Health and safety outside the Health of products and product life cycle analysis
workplace (Chapter 17) Ensuring that a robust product recall system is in
place
Gaining of quality standards, i.e. ISO 9000 series
Governance “ corruption, crime Promote transparent governance
(Chapters 7, 21, 22 and 23) Abide by the laws (but unfair and unjust laws)
Reform of laws
Environmental risk
Environmental management risk Environmental management systems
(Chapter 18) Gaining of EMS standards, i.e. ISO 14000 series
Implementation of precautionary principle
Following the principles of sustainable
development
Emissions to air “ air pollution Becoming carbon neutral and energy efficient;
(Chapters 18, 19 and 20) reduced reliance on external energy sources
Emissions to land “ waste/reuse/ Reduce waste, increase reuse and promote
recycle (Chapter 19) recycling “ leadership
Develop products with fewer materials, energy
Emissions to water “ water scarcity Waste water use policy; water recycling and reuse
(Chapter 19)
Resource efficiency “ sustainable Communicate benefits of sustainable production
production and consumption Improve labelling and communication of
(responsible consumerism) information of products
(Chapter 19) Maximise efficiency of products and consider by-
products
Use components produced in a socially and envir-
onmentally responsible manner
Supply chain management Indirect damage to purchaser™s reputation
(Chapters 18 and 19)




How to use this book
Approach to the methodology
Your organisation™s goals will benefit from aspects of this book: some chapters
may prove to be more relevant to different sectors of your activities than others.
The issues raised may even help focus upon new opportunities to improve
management activities, take balanced risks and look for opportunities, or
strengthen the business case for risk management activities previously viewed
as peripheral, or even irrelevant.
Handbook overview
xxxii



The primary aim of the following chapters is to help individual organisa-
tions evaluate their level of risk and to prioritise action in order to address
these risks. The chapters outline methodologies which may be adopted for
assessing both tangible and intangible risks.


Sector priorities on a range of current issues
Analysis of SERM Rating Agency research suggests where the critical issues are
for your sector of operation with a “ being key reading.


A recommended reading checklist, by industrial sector

Part A Part B Part C Part D
Introduction Economic Social chapters Environ-
chapters chapters ment
chapters

Sectors 2“6 7 8 9 10 11 12 13 14 15 16 17 18 19

“ “““ “ “ “ “ “ “
Aerospace & Defence
“ “ “ “ “ “
Automobiles & Parts
“ “““ “ “ “ “ “ “
Banks
“ “ “ “ “ “
Beverages
“ ““ “ “ “ “ “ “ “
Chemicals
“ “ “ “ “ “ “ “ “
Construction & Materials
“ ““ “ “ “ “ “ “ “
Electricity
“ “ “ “
Electronic & Electrical
Equip™
“ “ “ “ “ “ “
Equity Investment
Instruments
“ “ “ “ “
Fixed Line
Telecommunications
“ “ “ “ “ “ “ “
Food & Drug Retailers
“ “ “ “ “ “
Food Producers
“ “ “ “
Forestry & Paper
“ “ “ “ “ “ “ “ “ “ “
Gas, Water & Multi-
utilities
“ “““ “ “ “
General Financial
“ “ “ “ “
General Industrials
“ “ “ “ “ “ “ “ “ “ “
General Retailers
“ “ “ “
Health Care Equipment
& Services
“ “ “ “ “ “ “ “
Household Goods
“ “ “ “ “ “
Industrial Engineering
“ “ “ “ “ “ “
Industrial Metals
“ ““ “ “ “ “ “ “ “
Industrial Transportation
“ “ “ “ “ “ “ “
Leisure Goods
“ “ “ “ “ “
Life Insurance
“ “ “ “ “ “
Media
“ “ “ “ “ “ “ “ “ “
Mining
(Continued)
Handbook overview xxxiii




Part A Part B Part C Part D
Introduction Economic Social chapters Environ-
chapters chapters ment
chapters

“ ““ “ “ “ “
Mobile
Telecommunications
“ “ “ “ “
Non-equity Investment
Instruments
“ “ “ “ “ “
Non-life Insurance
“ “““ “ “ “ “ “ “ “ “
Oil & Gas Producers
“ “““ “ “ “ “ “
Oil Equip™, Services &
Distribution
“ “ “ “ “ “ “ “
Personal Goods
“ “““ “ “ “ “ “ “ “ “ “ “
Pharmaceuticals &
Biotechnology
“ “ “ “ “ “
Real Estate
“ “ “ “
Software & Computer
Services
“ “ “ “ “ “ “
Support Services
“ “ “ “ “ “ “
Technology Hardware
& Equip™
“ “ “ “ “ “ “ “
Tobacco
“ “ “ “ “ “ “ “ “ “
Travel & Leisure
“ ““ “ “ “ “ “ “ “ “
Government Departments
“ “ “ “ “ “ “
Not-for-Profit
Organisations
2“6 7 8 9 10 11 12 13 14 15 16 17 18 19
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Acknowledgements


The Authors wish to express their thanks to all of those who have encouraged
and supported the preparation of this book, both those who are mentioned
expressly and those who are not.
This work could not have been completed without the contribution of reli-
able colleagues who have submitted material referred to in the Chapters and
whose profiles are mentioned again below separately. In particular we would
like to commend David Kaye who has kindly written the Foreword, as well as
contributing material to chapter 8.
In addition several other colleagues have provided some material and check-
lists that have enabled the preparation of the remaining chapters in a timely man-
ner. With this in mind acknowledgement and thanks (listed generally in the order
of their input) to: Christopher Davis (Davis & Co Law Firm); Mike Dance (Jackson
Parton, Shipping Solicitors); Steven T Miano (Wolf, Block, Schorr and Solis-
Cohen LLP); Zaid Hamzah; Stephen Mason; Claude S Lineberry; Geoff Roberts;
Michael O™Keefe (former DCI at New Scotland Yard); Raj Patel, (Royal Holloway,
University of London); Yeshi Seli (Business India); Vijay Sardana (Achievers™
Resources Pvt. Limited); Cate Newness-Smith (Director, Mountain Top); Vikas
Sharma; Jayant Bhuyan; Shalini Agarwal and Sakate Khaitan (ALMT Legal);
Rishi Bhatnagar and Arif Zaman (Lead Author and Programme Director CBC-
SCCI South Asia Trade and Investment Network (SATIN) and Visiting Tutor,
Centre for Board Effectiveness, Henley Management College, UK), along with our
friends and colleagues at SERM and EFR Ltd., as well as James Ford and James
Heal who compiled “One Year on from 7/7 “ A Report by the London Chamber of
Commerce” (July 2006) and for their permission to cite and reprint key extracts
and findings.
The Authors also wish to express their appreciation of the support and edi-
torial comment provided by Mike Cash and to thank the Publishers, Elsevier,
for their enthusiasm and support.
Dr Spedding would like to express many thanks to Dr Purna, whose guid-
ance and ongoing advice has been a constant source of inspiration. She also
acknowledges the painstaking proofreading of her mother, who has provided
this service lovingly since her first publication in 1986. In addition she acknowl-
edges the encouragement of her father, who has respected her writing over the
years. Finally she acknowledges the patience, encouragement and support of
her family members “ especially her son Ajan “ who have shared her time and
attention as she worked on this project and generally for their ongoing belief in
her work.
Adam Rose would like to acknowledge Jonathan Barber (CEO of SERM

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