More firms turning to risk sensing: Survey

The ability to detect new risks and take steps to mitigate their impact - known as risk sensing - is becoming more important for businesses.

And many companies believe new tools are needed to manage risks amid an increasingly connected global environment.

"Something that happens in one part of the world will actually fly at the speed of light, that will impact the rest of the world either through social media or through the Internet," said Dr Janson Yap, leader of Deloitte Asia-Pacific and South- east Asia enterprise risk services.

"So there is a lot more transparency around problems and non-compliance and fraud," he added.

A survey by Forbes Insights on behalf of Deloitte Touche Tohmatsu yesterday identified the pace of innovation and regulatory changes as the key strategic risks facing businesses over the next three years. This includes, for example, emerging technology trends that could disrupt a given industry.

Other risks that could affect business strategy in 2018 are related to talent attraction and retention, as well as damage to the firm's reputation, the survey found.

Between May and June, the survey polled 155 senior executives from companies with revenue of at least US$1 billion (S$1.39 billion). Deloitte said the global survey covered firms in major industries like banking and financial services, as well as life science and healthcare.

Dr Yap told The Straits Times that to spot and pre-empt risks, more "advanced" companies are turning to technology to conduct "risk scanning". "It's about using technology, key words and artificial intelligence to pull out scans of trends and announcements from social media, from the Internet," he added.

The information that is of concern to the company will then be flagged and channelled to analysts for further investigation.

Dr Yap said the use of applied analytics to detect fraudulent transactions is becoming more common among businesses. It is used in areas such as procurement, employee claims and vendor transactions.

A version of this article appeared in the print edition of The Straits Times on October 22, 2015, with the headline 'More firms turning to risk sensing: Survey'. Print Edition | Subscribe