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Risk Management after Coronavirus: A Conversation with Keishi Hotsuki, Chief Risk Officer, Morgan Stanley

October 15, 2020

Speakers:
Keishi Hotsuki, Chief Risk Officer of Morgan Stanley and a Director of Mitsubishi UFJ Morgan Stanley Securities

Moderated by Eliot A. Cohen, Dean of Johns Hopkins SAIS

Keishi Hotsuki, Chief Risk Officer of Morgan Stanley and a Director of Mitsubishi UFJ Morgan Stanley Securities, joined the school for a conversation on risk management after the COVID-19 pandemic.

The discussion began with recalling his childhood and his journey to success, noting how his curious nature as a child helped convince him to apply for a Master’s in the U.S. at the age of twenty-five. Having never left his home country of Japan before, and still engaged in learning the English language, he decided that a risk for a brighter future was worth taking. This would become the basis of his long career in understanding and helping to formulate policy regarding risk management. Consequently, Hotsuki noted his diversified and fulfilling career that has taken him through Morgan Stanley, Merrill Lynch, and Bankers Trust.

Regarding his field of work, Hotsuki shared valuable insights with the audience noting that too many people are “nervous and prone to indecision” when it comes to risk, but that “risk is not a bad thing.” This is because without risk, money cannot be made. Furthermore, he mentioned how the financial crisis left him with both positive and negative outcomes. Negative in the sense that he was unable to prevent the crisis for his company, and positive in the sense that he at least tried to push-back on policies that played a role in the financial crisis. Hotsuki further highlighted the role of Sino-American relations, over-regulation, “zombie (government aided) firms,” and Climate Change as four of the greatest challenges post-COVID-19.

In conclusion, Hotsuki left the audience with the following advice, “identify the risk, measure the risk, realize its severity, and finally make a decision.” He stressed qualitative skills, managing emotions, succinct – logical thinking, and said the field looks forward to further evolution through curious young individuals.