For many treasury and finance professionals, the possibility late this summer that the U.S. government might default on its debt emphasized the importance of preparing for all kinds of possible futures. Now the risk of default is looming large once again—and this is only one of many recent events to raise executives' alert to threats outside their control.

From all the fallout of the Covid-19 pandemic through to the narrowly avoided government shutdown at the end of September, we have been operating in an era of constant systemic disruption. Living through these unpredictable situations has proven, time after time, that organizations in every industry need to strengthen their risk and resilience programs to account for scenarios that might once have been considered too obscure to plan for.

Shifting from reactive to proactive risk management enables an organization to anticipate disruptions and implement the necessary mitigation strategies to reduce the impact of those events. A significant component of this shift is ramping up a scenario testing program to better understand the potential impact of any disruption that might happen.