Olivier Sorba

What do you see as the highlights of your period as president of AMRAE?

OLIVIER SORBA: I think the main event was the association's congress in Nice at the beginning of this year. This was very well attended - 1,230 people - and produced some very lively debate. It was a good opportunity for people to meet and work on the topics of the moment, and we had excellent feedback. As well as the plenary sessions. there was a full day of workshops.

We expect next January's congress in Biarritz on 26-28 January to be equally successful.

What have been the main developments during this time that have affected AMRAE members?

OLIVIER SORBA: There are two main areas. The first is related to insurance.

We are still in the aftermath of 11 September 2001 and of a number of natural catastrophes. There has been a great deal of debate on whether the market is softening, how long it will continue and which segments are affected. Price is not the only issue, of course. Quality has to be considered too. We like having our insurers near at hand, in France or at least in Europe. We know that they have to be profitable. But I'm happy to see that prices have softened.

The second area is corporate governance. There has been a huge wave of activity because of Sarbanes-Oxley in the US and the LSF (Loi de Securite Financiere) in France. You have more transparency, more responsibility for boards, which means more reporting internally, so things have to change.

This affects anyone who is involved with risk or internal controls, even the risk manager who is only focusing on buying insurance. At AMRAE, we try to monitor these changes, dedicating time to talking with each other about what is happening and how we should approach it. As much as we can, we try to influence the regulators so that reporting is set in place in the best and most meaningful way.

Do you think the role of the risk manager is becoming more widely understood and valued in French organisations? If so, why?

OLIVIER SORBA: Yes. I went to a presentation held by one of the 'Big Four' recently, talking about internal controls. There was a list of the people involved within the organisation and risk managers were up there along with the financial director and internal auditor. If you read COSO II and the Enterprise Risk Management framework, this is all about risk management. It is an interpretation of the word 'risk' that is very wide.

There is a clear area that relates to what we do as risk managers. Companies have to deal with risk; it is more readily understood and what we are doing is more readily understood. This has made a huge difference.

What do you consider are the main challenges affecting risk in French organisations?

OLIVIER SORBA: The main challenge is the huge focus on corporate governance, which is pushing us towards more reporting. But reporting is not the end of the story. Basically, success for risk management is decided at grass roots level. It is a matter of culture. Our challenge is that we know that reporting and transparency are good, but success also derives from culture, so we have to have both.

What do you think are the main impediments to embedding risk management in an organisation?

OLIVIER SORBA: The main problem is time. It doesn't take long if all you want to do is to shuffle paper, but that has no effect on culture or the reality of risk management. If you want to embed risk management successfully and effectively, it takes time. It is a burden on companies.

At some point, people will need to decide how much money should be put into controls and how much on production. Risk management creates value in the long term and production creates value in the short term. There will be an equilibrium point.

Do you believe the insurance market will remain cyclical?

OLIVIER SORBA: My personal view is that it will. There is no entry cost in the reinsurance market. In order to participate you just need the right people and money. When the price of insurance goes up, there is an incentive to come into the market, and people can do this quickly. When the premiums go down, the newcomers tend to stay a while because they don't want to lose their customers, which means the prices drop further. However, AMRAE is working with our insurance and reinsurance partners to find ways to reduce the peaks and troughs of the cycle.

What are AMRAE's future plans?

OLIVIER SORBA: We are very much dedicated to education - it is not a plan for the future but a continuous process. We have launched a course on the strategy of risk management, continuing professional development for people who already have a good background in risk management or who have an academic background but want to go deeper into the risk management area, and this has proved very successful.

We also maintain good relationships with academic institutions of various kinds that are involved in risk management. We are interested in any initiative in that respect. There are only 24 hours in the day, but we try to help as much as we can.

Thirdly, we are trying to make the association even more visible throughout the year. The congress is a very exciting event, and we hold lots of other events during the year. AMRAE is very active. But we are trying to attract more people to attend, in order to capitalise on what we do once a year at the congress.

We also think that it is time to make room in the association for people who are involved in risk management but not directly managing risk for a corporation. At an extraordinary general meeting in late November, we decided to admit associate members. These will not include insurers or brokers as we feel it is important that AMRAE should communicate with a risk management focus, but it will include anyone else involved with risk management.