IRM India, India Affiliate of Institute of Risk Management, UK, a leading professional body for Enterprise Risk Management, and National Institute of Micro, Small and Medium Enterprises (ni-msme), an organization of the Ministry of MSME, Govt. of India, have signed a Memorandum of Understanding, to support the Indian MSME sector in strengthening its defences against threats such as the Covid-19 pandemic, through a series of policy and education initiatives. The sector is the largest job provider in the country, second only to agriculture, and has struggled with employment and economic losses since the lockdown began.
Discussing the agreement, Mr. Hersh Shah, CEO, India Affiliate of Institute of Risk Management, UK, said, “World Bank, World Trade Organisation and other organisations have acknowledged the grave risk that MSMEs have been confronted with globally, and have highlighted the urgent need for sweeping reforms to help them steer safely through these difficult times. The substantial impact of the Covid-19 pandemic on domestic MSMEs further corroborates the need to pivot from the sector’s current approach towards an enterprise risk-driven one, which has proven helpful for many organisations across the world, especially in developed economies.
We are committed to supporting ni-msme’s strategic vision for the progress of micro, small and medium enterprises in India and recognise ni-msme’s research and education in the field of entrepreneurship. In the coming months, we aim to develop a blueprint that will help India’s 6.33 crore MSMEs apply globally-recognised enterprise risk management frameworks and practices, to navigate successfully through the current crisis, as well as safeguard themselves against future uncertain events beyond just financial risks. The current pandemic has severely impacted the ability of Indian MSMEs to compete in the global market, making it imperative to create an environment that will nurture them, and provide a robust policy roadmap to help them regain their global advantage.”
Ms. S Glory Swarupa, Director General, ni-msme, said, “National Institute for Micro, Small and Medium Enterprises (ni-msme), an organization under Ministry of MSME, Govt. of India has always been conceiving specialised need-based initiatives in tune with the changing policy and economic situation. ni-msme is not a mere world-class training institute but a comprehensive hand-holding institution for the MSMEs and entrepreneurial youth in India and the developing world.
ni-msme has embraced pertinent concepts and technologies in its functions to keep pace with the tenor of the times. The current pandemic has called for a serious understanding of enterprise-wide risk assessment and a culture that shapes risk-based decisions in organisations irrespective of their size. With IRM’s expertise in enterprise risk management and research, ni-msme is extremely proud to work together in empowering India’s MSMEs and small business owners with the knowledge and resources required to respond to enterprise level risks including uncertain external events that are constantly evolving in today’s fast paced dynamic world.
This collaboration will help micro, small and medium businesses to identify, plan and mitigate the associated financial and enterprise risk in their enterprises but will also train them to utilize the available resources, avail government support, MSME support schemes and develop their own entrepreneurial capabilities to generate employment by becoming “Atmanirbhar”, ultimately helping India to become a self-reliant nation, Atmanirbhar Bharat – the vision of the Honourable PM Shri Narendra Modiji.”
Across the world, large organisations have gradually started migrating to risk-driven growth strategies and enterprise risk management frameworks. However, this culture has not influenced smaller businesses in India. Even prior to the pandemic, start-ups and SMEs in India were grappling with failure due to a multitude of reasons, such as difficulty in scaling operations and acquiring/maintaining the talent pool, inadequate technology adoption, competition from established players, insufficient funding and liquidity, lack of knowledge and expertise, inability to attract more customers, and poor succession planning. With the heightened vulnerability of the sector in the aftermath of the pandemic, an overhaul of the existing system has become critical.
Through their partnership, IRM India and ni-msme aim to reorient Indian start-ups and MSMEs towards risk-awareness and strategic mitigation planning. To this end, they will also collaborate on various initiatives to advance risk management expertise in the sector, through research, consultation and training events. As part of the collaboration, they will also offer a Joint Certificate Program in Enterprise Management and Risk Valuation, for start-ups and MSMEs that will qualify for an exemption from IRM’s Level 1 examination.