Riskmatician Commander's Intent (RCI)

The chief riskmatician of any corporation must have a clear Commander’s Intent (CI) - A simple statement that's used firm-wide to guide decision making. It must detail the purpose of the organization clearly to enable others in the organization to make sound risk decisions without the need for constant communication. It is almost always the case that a weak commander's intent is the culprit of many historic failures of financial risk management.

The riskmatician's CI should focus on the benefit to customers only. Not shareholders, employees, rating agencies... just customers. A firm that evolves for the interests of any group except customers is pursuing a dead end. Only companies valuable by their customers will thrive long term, not the ones that are the best places to work, or make their executives the richest. Firms that evolve into exquisitely refined environments for employees or shareholders at the expense of customers will eventually become extinct.

Putting customers at the center of the CI is the only policy that leads to good long-term results for anyone, including service providers, employees, and shareholders. The CI is the foundation for which financial risk management can evolve. How customers are treated internally determines the evolutionary process of the company, and the only productive evolutionary trajectories are ones that serve customers.

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