The Nature of Risk

The Nature of Risk is a short, beautifully illustrated and easy-to-understand book written to help readers face one of modern life’s most important and difficult tasks—confronting risk. Free of complicated theories or formulas, The Nature of Risk relies instead on a simple story featuring a cast of familiar, forest-dwelling animals, each of which embodies a different approach to risk management. At least one of these approaches will seem familiar to every reader—whether they knew they had an approach to risk management or not. Then, as the story unfolds, the strengths and weaknesses of each approach will be revealed through a series of "natural" tests. Finally, at the conclusion of the story, readers will come to a short review section designed to help them frame their first attempts at managing risk—with or without professional help.

David X Martin, an internationally recognized expert on risk management, is a senior consultant at global management consulting firm Oliver Wyman. His long career includes stints at PricewaterhouseCoopers (PWC), Citibank, and AllianceBernstein. He has extensive experience working with regulators and sovereign governments, and at one time or another has been responsible for the oversight of investable assets, investment strategies, operations, quantitative research, distribution channels, trading, and investment banking. He also has extensive experience running financial holding companies, and overseeing acquisitions and the creation of new banking businesses. Mr. Martin was the founding Chairman of the Investment Company Institute's Risk Committee (ICIRC), Co-Chair of the Buy Side Risk Committee-composed of the Chief Risk Officers of the twenty largest asset management firms-and a member of the Sanctions Subcommittee of the US Department of State's Advisory Committee on International Economic Policy. Presently an adjunct professor at NYU's Stern School of Business, he has published numerous white papers on compliance and risk, enterprise risk management, corporate governance, and cyber security, as well as Risk and the Smart Investor, published by McGraw Hill in the fall of 2010. While Chief Risk Officer at AllianceBernstein Mr. Martin also served as a Director of Sanford Bernstein LLC. In those capacities he was responsible for the oversight of over $875B in assets, and was a member of the firm's committees on valuation (Chair), ethics, internal controls, compliance, new product approvals (Chair), fraud, business continuity, and information security. He has participated in innumerable industry conferences as a featured speaker and expert panel member, and has provided market commentary for Bloomberg Television. At Citibank, working with both John Reed and William Rhodes, David X Martin developed and implemented a comprehensive process of enterprise risk management known as Windows on Risk. There he focused on understanding macro-economic trends, continually reassessing the company's global risk profile, and proactively managing risk. He worked regularly with the Citicorp Board, rating and regulatory agencies, major corporate clients and investors, payment systems, and sovereigns. Mr. Martin, a Certified Public Accountant, earned his BBA from Baruch College and received his MBA from New York University's Graduate School of Business.