CFOs may be held accountable for natural disaster losses in the year ahead
- Published: Thursday, 10 January 2019 08:34
In the company’s latest white paper, 'Master the disaster - Why CFOs must initiate natural catastrophe preparedness in 2019 and beyond', FM Global argues that a failure to prepare for natural hazards leaves CFOs in the hot seat when it comes to financial losses due to disasters.
“Were [CFOs] to conduct a more systematic cost-benefit analysis of natural disaster risk preparedness, they would realise that allocating capital toward loss prevention provides significant long-term returns,” Wharton professor Howard Kunreuther said in the white paper.
With institutional investors saying enhanced reporting of natural disaster risks has become a priority, Kevin Ingram, executive vice president and CFO at FM Global, notes, “If the CFO doesn't lead the charge to invest in reducing natural-hazards exposures, they will be the ones that stakeholders hold accountable for not properly addressing the risks.”
The whitepaper includes the viewpoints of other business risk analysts who say the growing CFO responsibility is not going away in an era of increasing business concerns over climate change risk and disclosure.
Read the white paper (pdf).