All companies, regardless of size, face a myriad of risk in today’s global business and economic climate — from cyber risk to natural disaster preparedness to supply chain disruption. When risk is inevitable, a company’s response to it becomes critical. I connected with CFO of FM Global, Kevin Ingram, to discuss the company’s latest Resilience Index, technology’s impact on businesses, and how Kevin and his team foster resilience within their own office. This interview has been edited and condensed. Jeff Thomson: FM Global recently released its annual Resilience Index, which ranks 130 countries based on their enterprise resilience to disruptive events. How can finance executives use the Index? Kevin Ingram: For executives who are discovering the index for the first time they now have a resource to help make strategic decisions on: • Where in the world to expand   • What suppliers to select • How robust their supply chains can be • And what customers may be vulnerable Of course, finance executives have always scouted locations that are close to customers, suppliers, distribution networks and affordable labor, and that offer favorable financial and regulatory conditions. But the index helps them delve deeper. It provides objective country-by-country data on 12 drivers of enterprise resilience to disruptive events. We define resilience as resistance to a disruption and the ability to rebound.  In this way, the index is a strategic decision-making resource to help finance executives gain insight into their business and supply chain risk around the world as well as a roadmap to guide a more carefully considered site selection strategy with an interactive reference of data they’ll need to make such decisions.   Thomson: In today’s global business and economic climate, what are the greatest risks to an organization? Ingram: It’s hard to say which risks are greatest since that depends so much on a company’s location and business practices. For clarity, we categorize risks into three areas: economic, risk quality (natural hazards/fire), and supply chain vulnerabilities. We’ve incorporated three emerging risk drivers into this year’s edition of the index, which are inherent cyber risk, urbanization rates, and supply chain visibility. In addition, we recently polled senior financial executives to determine the top operational risks that have harmed their company in the past five years. Sixty-six percent of financial executives surveyed say their organizations have been harmed by equipment failure, nearly 60% say their firms have been impaired by data breaches or cyber-attacks, and more than half (52%) have had their operations affected by natural disasters. Despite these ongoing risks, over half of respondents (54%) say their organizations have not developed or tested formal loss-recovery plans. Thomson: How have advancements in technology, specifically social media and the instant spread of information, impacted the way companies identify, address and respond to potential crises and risks? Ingram: Technology is a double-edged sword. Until recently, computer systems were adjuncts to business. Now they are integral to business and, in many cases, are the business. Not only do computer systems drive financial, human resources and intellectual property functions, but they also drive industrial controls for power plants, water systems, transportation systems and other critical infrastructure. The more we ask of technology, the greater risk it poses. For example, because of the larger role of technology in driving business, a company must go beyond shoring up its own security and defend itself from vulnerabilities in third-parties — e.g., an overseas payment provider or cloud computing service. Social media cuts both ways as well. It provides new ways to both warn business owners about emerging threats and to potentially victimize them by introducing new threat vectors. Thomson: FM Global focuses its work around resilience. In your opinion, what makes a business resilient, and how do you foster that within a company? Ingram: Resilience is the ability to resist disruption and rebound quickly during adverse circumstances. And we believe most loss is preventable. Business threats, such as a natural disaster, don’t disrupt all affected companies equally. Companies that aren’t resilient face a greater risk of loss of revenue, market share and shareholder value, not to mention the impact on reputation and potentially the entire business to better-prepared competitors. The problem we often see is that leaders aren’t aware or don’t admit that a disaster can strike them, at least not on their watch. So they don’t make the investments in resilience that can keep them strong and competitive over the long run. Remember, a 100-year flood has a 1% chance of striking every year. If such an event occurs, and there’s no reason it can’t strike two years in a row, the problems can be enormous. Is that too vigilant an approach? Clients who have been through a disaster rarely question our advice. They are painfully aware of the stakes. So in client companies and in our own, we try to cultivate a culture of resilience where we prepare for the worst and hope for the best. Thomson: How does FM Global innovate and defend its market position in a very competitive commercial and industrial insurance landscape? Ingram: We are committed to helping our clients prevent a loss, which can have disastrous effects on their business even when they’re insured. That’s more than rhetoric. Our commitment to loss prevention often means researching the new specific hazards our clients may be contemplating whether it’s taller warehouses, lithium ion battery storage or use of innovative digital smoke detection equipment. Other key strategies: • We operate as a mutual company. That means our policyholders are owners of the company, and our focus is on long-term sustainability vs. quarterly returns. Profits go back to clients as membership credits. We believe this ownership structure is in their best interests. • We also focus on globally consistent delivery of coverage for our multinational clients. And importantly, wherever a company is in the world, we pay claims willingly, fully and quickly. Thomson: Although you’ve been with FM Global for 18 years, you have a little over six months under your belt as CFO. What skills are required in this new role and what are your immediate goals as CFO within the year ahead? Ingram: I want to ensure we continue developing our own resilience. We counsel our clients that resilience is paramount, and we are committed to that principle ourselves. Our clients depend on it. In many ways, resilience of any company, FM Global included, is a function of the CFO’s financial, accounting and risk management work. In my new role, I’m constantly reviewing and managing all types of risk. One of the most dynamic threats to any company is cyber risk, and we’re making sure our business, our partners and our clients are as resilient as possible particularly in this regard. On a more granular note, we’re working to continue the integration of our finance operations. This includes moving the risk management function into finance as many of our clients have done.