Active risk management and holistic approaches to preventing and mitigating threats and hazards have been identified as increasingly important to companies. This has come about not only as a response to regulatory developments, but also to satisfy stakeholder demands regarding the creation and preservation of value. Sean Lyons describes the various tensions between creating and maintaining value, and the demands of long-, medium- and short-term objectives and what drives them, in his recently published book Corporate Defense and the Value Preservation Imperative (CRC Press 2016).

The narrative focuses on internal functions that are traditionally regarded as responsible for the defense of the company, and the creation and preservation of value through increased alignment with the business objectives and genuine collaboration between the defense functions.

Lyons sets out his argument by looking at the issues from multiple angles, and through the lens of each of the traditional corporate defense functions. This leads to a matrix that is derived from strategic, tactical, operational and integrated approaches in combination with corporate defense related activities encompassed by governance, risk, compliance, intelligence, security, resilience, controls and assurance. In developing the proposition for a more integrated approach to corporate defense, Lyons describes an expansion of the traditional three lines of defense to five lines that includes the Executive Management and Board of Directors. The descriptions of how each line should fulfil its responsibilities and the observations on the oversight roles are not particularly new. The level of detail however, and logical development of what accountability means in practice, is clearly set out. The definition of roles forms the basis for the reasons why and how to develop a corporate defense mechanism and are further developed throughout the following chapters.

The author addresses the subject matter at a high level of abstraction with only a few examples found in the opening sections of the book that are almost all drawn from the financial industry during the crisis of 2007-2008, and which then peter out in the general sections. By focusing on the principles and theory of corporate defense, Lyons makes it sound almost easy to incentivise change within a company: Attitudes that currently begrudgingly tolerate corporate defense functions as costly but necessary evils, will be transformed into recognising the imperative for change. The success of collaboration through the matrix as the way to long-term value creation and a sustainable business model will thus be brought to life. If it only were so simple in reality. Anyone who has been tasked with developing defense strategies and implementing preventive measures in a company will attest to the difficulties of getting everyone on board and that it can be a long and complex process. And without the absolutely essential ‘tone from the top’ that has to emanate frequently and clearly from the board and executive management such change will not be possible, let alone sustainable. If the author had grappled with this reality in more detail it would have made his arguments even more compelling for developing alignment between operational management and defense functions.

The elusive notion of what constitutes ‘value’ is acknowledged as being a subjective issue that will depend on the stakeholder and their perspective. Thus the development of the imperative to create value in order to satisfy the various stakeholders with their competing and sometimes conflicting interests is not solved; the weight and priority to be ascribed to the various stakeholders is necessarily left to each company to determine and of course in a book that covers the topic for all industries, it could not be otherwise. Examples of companies that have successfully achieved or are at least well on the way along the five-step roadmap to cross-functional maturity would have enriched the high level text. For example, the author describes step three of this process as the enterprise-wide phase that involves tactically embedding the defense philosophy and standards into the culture of the enterprise. As those working in the corporate defense functions have to demonstrate the success and outputs of their preventive measures in order to martial their arguments for sticking with the program, and proving the success of a preventive measure is never conclusive, a few illustrations of how a company has tactically embedded a defense philosophy into the culture of the enterprise would have been enlightening.

Whilst this reader would have preferred fewer sporting and martial arts analogies and editing of the repetitive sections, the comprehensive and logical sequencing and development of the arguments that culminate in the business case for the collaborative alignment of the defense program make this an essential read for anyone trying to implement a risk, compliance or any other defense program in a multinational company.

About the book author: Sean Lyons is internationally recognized as a corporate defense pioneer and thought leader. As the architect of the cross-functional discipline of corporate defense management (CDM) he is widely regarded as the foremost authority in this emerging field. With almost three decades of experience in corporate defense activities he is a firm advocate of the requirement for corporate defense to play a more prominent role in corporate strategy. For more information please visit: https://www.crcpress.com/authors/i14908-sean-lyons