Ex-MI6 chief says the biggest risks for CEOs are the threats they already know about

In today's CEO Daily, Sir Richard Moore, the former head of the UK's secret intelligence service MI6, shares his insights on managing systemic risk for CEOs. Moore argues that the biggest risk for companies today is not a sudden, unexpected event, but rather the cumulative impact of known issues such as the COVID-19 pandemic, the conflict in Ukraine, tensions in the Middle East, and trade disputes.

He emphasizes the importance of resilience and the ability to recover from setbacks, likening it to "resilience eating efficiency for breakfast."

Moore warns that as companies expand globally, they must also think locally, as blocs are no longer behaving uniformly. For instance, within the EU or ASEAN, countries have divergent views on China, with the Philippines even clashing with China over the South China Sea. He cautions against assuming China's growth trajectory is linear, noting the country's current economic headwinds but also acknowledging its active presence in open-source AI models.

Instead of decoupling from China, Moore advocates for "derisking" through a better understanding of the country's vulnerabilities.

Drawing from his intelligence background, Moore stresses the need for leaders to think through various scenarios rather than making predictions. He believes that focusing on understanding how situations might unfold is more valuable than forecasting outcomes. Throughout his career, Moore has seen that trust is crucial in international partnerships.

Building these relationships takes time, as sovereign nations may not readily extend trust. He advises leaders to invest in these relationships early on to better navigate crises.

Within organizations, Moore stresses the importance of creating a culture where employees feel comfortable speaking "truth to power." When leaders are overbearing and stifle dissent, decision-making can suffer. Overall, Moore's advice emphasizes the necessity of understanding risks, building resilience, fostering trust, and preparing for a complex, interconnected world.