Patrick Liedtke, European head of financial institutions group, BlackRock
Liedtke joined BlackRock, the world's largest asset manager, in 2012 where he was put in charge of advising insurers on asset and risk management. Prior to this he led The Geneva Association, building it into a global think-tank for the insurance sector. He has also been the founder of the Chief Investment Officers Network, the Financial Directors Network and the Amsterdam Circle of Chief Economists, as well as co-founder of the Chief Risk Officers Network and the World Risk and Insurance Economics Congress.
Who do you most admire in the field of risk management?
I admire the institutions who have advanced their risk management practices to cover the whole organisation, including people, operations, assets and liabilities, and those that deal with unexpected events in a dynamic way.
What have you learnt about communicating risk?
We have learnt that risks need to be fully understood, analysed and communicated before decisions are made. We believe that risk is managed best by understanding the true drivers of asset class behaviour, and that insurers and asset managers need to work together to decide on the best investment strategies they can utilise to achieve their objectives. Sometimes we see investors acknowledge that risk management needs to evolve in their organisation, but that it is tough to enact change.
What are the major challenges ahead?
Insurers need to adapt their business to new technology and the low interest rate environment, both on the asset as well as the liability side. Senior managers are balancing the demands stemming from fundamental changes to their business, while at the same time facing massive regulatory issues.
What will be the next big development in risk management?
Insurers will need to pay more attention to liquidity issues, and how excess liquidity is managed and selectively converted into an income stream – without generating inappropriate risk to their businesses.
What are your other interests?
I enjoy a certain amount of risk taking in my private life through activities such as extreme skiing, motor racing, and skydiving. But the risk taking has to be controlled. In this way it is not much different to good asset management.
