Integrated risk management

In the ten years since it was formed through a merger of GrandMet and Guinness, the premium drinks group Diageo has developed an integrated risk management system that gives the business enough confidence in its understanding of its exposures to retain a significant proportion of its own risk.

Tomorrow the company’s global supply risk manager, Sally Russell, and her colleague Scott Tricker, risk finance manager, will give a joint presentation on how the system reached its current level of sophistication and how the risk management function informs management decisions for a group with a complex structure.

Diageo’s brands span spirits, wine and beer, and include Smirnoff, Johnnie Walker, Guinness, Baileys, J&B, Captain Morgan, José Cuervo, Tanqueray, Crown Royal, Beaulieu Vineyard and Sterling Vineyards wines, and Bushmills Irish whiskey.

In 2006, Diageo won two prestigious StrategicRISK European risk management awards for Most Effective Use of Technology and European Risk Management Team of the Year. These recognised the successful implementation of Diageo’s Licence to Operate programme to enable the ongoing development of a culture of managed risk taking across the company and ensure the protection of its people, brands and reputation. The programme provides a framework to deliver a transparent and globally consistent way of managing compliance with legislation and conformance to the company’s policies and risk management standards across global supply’s operations.