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Eamonn Cunningham named to Risk Management Honor Roll®

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Eamonn Cunningham named to Risk Management Honor Roll®

To say that Eamonn Cunningham has transformed the Westfield Group's risk management strategy would be a considerable understatement, in that it presumes such a strategy existed prior to his arrival.

By all accounts, risk management itself was an unfamiliar term at Westfield Group when Mr. Cunningham joined the Sydney-based retail property management and development company in 1986 as its group internal audit manager.

“My job as an administrator was just to buy the insurance,” Mr. Cunningham said. “But when I started digging into that, I began to ask some fundamental questions. Why are we buying a particular insurance policy? Is there another way to protect ourselves? Do any of our actions pre-event influence the outcome of an event, and all other things being equal, can they diminish our need to buy insurance?”

Mr. Cunningham — now Westfield Group's chief risk officer — said the philosophical groundwork for an enterprise risk management strategy that seeks to strike a balance between business interests and risk avoidance was already part of the company's culture.

What the company lacked, and what Mr. Cunningham has spent more than 25 years developing and implementing, was a unified risk management framework that encompasses the company's global operations, all organized under the core principle that every Westfield employee shares a responsibility for managing risk.

The integration and consistent execution of that framework, the extent to which it has successfully reduced Westfield's exposure to catastrophic property damage, business continuity disruptions and many other risks, and the positive effect it's had on the company's broader operations and strategic goals, are just part of the reason Mr. Cunningham has been named to Business Insurance's 2014 Risk Management Honor Roll®.

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“For me, risk management is all about instilling into the conduct of your enterprise the notion of risk and reward,” Mr. Cunningham said. “Of course, it would be a bit ambitious to expect everyone in the company to intuitively put that notion into practice, which is why we have these frameworks that we deploy across the globe in a manner that delivers the benefits of consistency and considered thought, but not in a manner where people perceive it to be a bureaucracy.”

Mr. Cunningham's innovative risk mitigation policies and procedures — coupled with his commitment to “layering certainty on top of certainty” when it comes to managing a global insurance program covering more than $35 billion in insured assets spread out over three continents — have been credited with saving the Westfield Group millions of dollars in potential losses, insurance premiums and claims costs over the course of his career.

However, those who work closely with Mr. Cunningham say his successes are not measured solely in financial terms, but also in the consistent adherence and support his risk management policies and procedures have received at every level of Westfield's business, including its regional corporate divisions, design and construction units, and day-to-day operating staffs at its 90 shopping centers worldwide.

Peter Allen, Westfield Group's chief financial officer and Mr. Cunningham's direct supervisor, attributed the companywide embrace of risk management's inherent value to Mr. Cunningham's insistence that Westfield's various business units view his role within the company not as a barrier to their operations, but rather as a facilitator of their safe pursuit of growth and innovation.

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“Because of the way that Eamonn leads, the people in our other divisions want to understand and make sure that they address their risks as a means of supporting Eamonn in what he does,” Mr. Allen said. “They believe that their business unit is going to be made better by adhering to the processes and procedures that we've enshrined in our risk management program.”

David Bidmead, Marsh L.L.C.'s New York-based global multinational client service leader and a personal friend of Mr. Cunningham's since assuming senior responsibility for Westfield's account with Marsh in 2000, said he often marvels at the extent to which Mr. Cunningham's risk management framework is consistently applied across the company's regional corporate operations in Sydney, London, Los Angeles and Auckland, New Zealand, as well as the day-to-day management of its 90 shopping centers worldwide.

“We've seen other companies attempt that same kind of permeation, and it usually results in a kind of turf warfare or power struggle, where someone in a chief risk officer position attempts to occupy the moral or intellectual high ground and dictate to the rest of the organization what it can and can't do,” Mr. Bidmead said. “Eamonn's approach is different, and its success is significantly influenced by his ability to closely empathize with the needs of the people he works with.”

“It's such a pleasure to me to hear someone like (Westfield Chairman Frank Lowy) talk regularly about risk, because it makes it somewhat easier for us to do what we do as the company's trusted adviser,” he added. “The people that we interact with at Westfield know that the management of risk isn't an add-on to their normal job, it's a core part of how they're expected to act each day. It's something that I wish we had in every client relationship that we've got.”

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