Mumbai, April 2023: Despite facing challenges such as tightening global monetary policies, rising inflation, slowing global growth, and elevated commodity prices, the Indian government and corporates have demonstrated resilience by employing efficient risk management strategies. This is reflected in the 3rd edition of the Corporate India Risk Index (CIRI) 2022, a proprietary study conducted by ICICI Lombard in collaboration with Front and Sullivan, which shows a rise in the risk index score from 62 in 2021 to 63 in 2022. ICICI Lombard India’s leading private general insurer has been a pioneer and thought leader in creating a first-of-its-kind risk index for India Inc and India Risk Management Awards (IRMA), a property for recognising organisations for their risk governance practices.
ICICI Lombard’s CIRI 2022 comprises 32 risk elements across 6 broad dimensions and draws upon global risk management best practices. A higher score signifies better risk management, enabling companies to adopt effective risk management practices.
The MD&CEO of ICICI Lombard, Mr. Bhargav Dasgupta, and the Global President of Frost & Sullivan, Mr. Aroop Zutshi, spoke at the CIRI 2022 launch event. At the 9th edition of the India Risk Management Awards, ICICI Lombard also recognised and felicitated over 250 corporates from large and medium sectors who have demonstrated exemplary risk management values.
Commenting on the launch, Bhargav Dasgupta, MD & CEO, of ICICI Lombard, said, “The ICICI Lombard Corporate Risk Index report provides the insights and tools necessary for companies to evaluate and manage their risk profiles, empowers them to navigate adversity for long-term and sustainable growth. The enhanced score in the 3rd edition of the Corporate Risk Index is a testament to the efficient risk management practices adopted by Indian corporates in the face of global headwinds and challenges. As we move forward, it is crucial for companies to stay ahead of the curve and adopt comprehensive and efficient risk management practices.”
AroopZutshi, Global President, Frost & Sullivan, said, “Strength of India’s story lies in the fact that Corporate India Risk Index score is steadily improving YoY, we are seeing a larger number of sectors moving towards a better Risk Index such as Telecom & Communication, Aerospace &Defense and Education & Skill Development. It is also observed that Large and Mid-size Indian enterprises are getting resilient and managing else transferring Market & Economy and Operational related risk arising from geo-political issues with a level of maturity that is indicating India’s journey of safeguarding its interests in an ever-changing risk world.”
The 2022 Risk Index shows all 20 sectors in ‘Superior’ or ‘Optimal Risk Handling’, with 7 sectors demonstrating ‘Superior’ handling, including Automotive, FMCG, Tourism, Healthcare, Telecom, Pharmaceuticals, and New Age.
The ‘Aerospace & Defence sector showed the most improvement in the Risk Index, bouncing back from 52 in 2021 to 63 in 2022 due to government and enterprise-led initiatives. Traditional sectors are also preparing for technological risks such as cyber threats and innovation risks.
Sectors such as Tourism & Hospitality and Transportation & Logistics have efficiently dealt with disruptions caused by the fuel price hike and terrorism. However, the Metals & Mining and Chemical & Petrochemical sectors showed a dip in risk management due to external macroeconomic factors.
Besides highlighting the performance of corporates on the Corporate India Risk Index, the study recommends measures to mitigate risk and achieve a Superior Risk Index score in 2023. These include envisioning risk through scenario planning, de-risking through a holistic approach, and using predictive future analysis to gain actionable insights.