"In the contemporary global scene, risk mitigation has to be undertaken inrelation to two major points: the increasing global integration in the realand financial sector and rising environment concern." Subramaniam said whilecautioning about underplaying the importance of the hitherto well knownelements of risk management.

While classifying risks as macro-environment, micro business or firm levelrisks, Subramaniam referred to Arthur Anderson's partner Cornac Murphy'sview about moving in to the new economy, characterised by trends generatinggreater opportunities and greater uncertainties.

"The approach to risk management has been changing fast in response to thequickening pace of upheaval and uncertainty in the business world",Subramaniam said, adding: "... risk management in the future will requireappropriate disclosure to to enable all stake holders to understand whatrisks have been taken".

Subramaniam envisaged the future of risk management as becoming trulyenterprise-wide in scope where in all functional departmental and culturalbarriers are eliminated and all of critical components of business riskmanagement are aligned to support the enterprise's strategy for creatingvalue.

Outlining his approach to risk management, Subramaniam said that differentrisks needs to be treated accordingly. In the context of increasing globalintegration, the most significant challenge for companies is going to be tobecome globally competitive.

This challenge can be generally addressed by having a strategy that isfocussed and is global in scope. Companies need to be worried about globalcompetitiveness in almost all businesses. The risk of becomingtechnologically obsolete can be managed by constantly scanning theenvironment for changes that can potentially alter the the economics ofbusiness, he observed.

"In most businesses, the company needs to spend on research and development,even if it is marginal. Organisational risks can be managed by designingorganisations that respond faster to the environmental changes.

Companies need to invest in providing training to its human resources; theyalso need to focus on developing systems and knowledge management systemswhere by the success of the organisation is not critically dependent uponany single employee.

As far as financial risk management is concerned, there are various markets,tools and techniques that enable corporates to manage these risksrationally. However, Indian markets and corporates do not have access tosome of these tools such as derivatives as of now, Subramaniam said.