ONE standout lesson in working for the public sector is managing risks. Risks refer to “uncertainty about the consequences of an activity or event with respect to something that humans value.” Governance, on the other hand, refers to the “actions, processes, traditions and institutions by which authority is exercised and decisions are taken and implemented.” Risk governance, therefore, applies the principles of good governance to the “identification, assessment, management and communication of risks.”

A framework that is often used in managing risks is enterprise risk management, or ERM. This is the “process of identifying and methodically addressing the potential events that represent risks to the achievement of strategic objectives, or to opportunities to gain competitive advantage.” The four components of ERM are risk identification, risk analysis, risk response and risk control, while the five types of risks include financial, operational, hazard, compliance and strategic risks. If risks are handled properly, we prevent a crisis.

In a VUCA (volatility, uncertainty, complexity and ambiguity) world, where we are today, managing risks is the most important task for both the public and the private sector. VUCA are “qualities that make a situation or condition difficult to analyze, respond to or plan for.” Consequently, understanding how to mitigate these qualities can greatly improve the strategic abilities of a leader and leads to better outcomes.

VUCA is the terrain all countries are in, post-Covid. All countries are figuring out how best to reboot. Countries who are going back to pre-Covid economy and governance will lose the edge moving forward. We are living with Covid and its permutation, and we are living more and more in a multipolar order. The flashpoints are the Ukraine-Russia war, which affects the supply of oil, and the movements in our part of the world due to the West Philippine Sea and Taiwan.

As security experts have pointed out, “the Indo-Pacific mega-region is home to the world’s most fluid, complex and dangerous security environment. Lingering traditional security flash points (Taiwan Strait, North Korea and territorial disputes) are exacerbated by the rise of China and the US-China great power competition. At the same time, non-traditional security threats, such as piracy and transnational crime, as well as climate change-related challenges, resource depletion and pandemics, are becoming key risks, already claiming many lives in the region. Finally, hybrid warfare practices, including disinformation, lawfare, cyberattacks and gray-zone situations, are becoming commonplace, adding another layer of complexity.”

With such an environment, leaders are becoming more risk averse, making sure that policies, plans, programs and activities are not rushed ensuring certainty, stability and predictability are followed for a conducive investment climate. Comes now the Maharlika Investment Fund (MIF) which was rushed and even certified by President Ferdinand Marcos Jr. MIF was not in Marcos’ 8-point socioeconomic agenda, not in his first State of the Nation Address and was certainly not in his priority legislative agenda. If economic managers are lapdogs, they should look at the Medium-Term Fiscal Framework (MTFF) which was adopted by both chambers of Congress for 2022-2028, “committing that the legislative agenda would be guided by the targets set in the framework.” The MTFF listed the country’s economic objectives, such as “achieving 6.5 to 7.5 percent real GDP (gross domestic product) growth in 2022; 9 percent or single-digit poverty rate by 2028; 3 percent national government deficit-to-GDP ratio by 2028; and less than 60 percent national government debt-to-GDP ratio by 2025.”

There was no MIF in the MTFF. Even the National Economic and Development Authority’s Philippine Development Plan didn’t have MIF. So, why the rush to pass? There is no surplus, and our current debt pile is about 94 percent of the expected P14.63 trillion debt by end-2023. Worse, try getting a third reading copy of Senate Bill 2020 and it will put to shame the institution of the Senate for a very convoluted legislation with so many loopholes and infirmities.

There are three other things that President Marcos made or did not act on while railroading MIF: first was the renaming of the economic cluster as the economic development group and creating the inter-agency committee on inflation and market outlook or Executive Order 28, a very bureaucratic approach to dealing with inflation, food and energy supply, and demand situation when such issues are dealt with by concerned agencies, discussed at cluster levels (if that body still exists), the Presidential Management Staff (used to be the think tank of the Office of the President [OP]) and the OP proper.

Second is the directive on geomapping of agricultural lands. This is not new since the former Agriculture secretary Manny Piñol had already set the National Color-Coded Agricultural Guide Map (NCCAG) electronically, including the types of soil, plants that will grow on it, farmers availing credit, among others. The NCCAG was supposed to aid farmers in their production activities on what specific crop grows best in a specific location. The NCCAG considered the challenges of climate change as well as the science-based interventions of the government toward climateready crop management systems.

Third, the non-action on the New Agrarian Emancipation Act which will benefit 610,054 agrarian reform beneficiaries who were granted lands under Presidential Decree 27, or Republic Act (RA) 6657, as amended by RA 9700, and who have outstanding loan balances as of the effectivity of the act. This measure passed both chambers and is the first social legislation of Marcos, but it has been on his desk since March 25, 2023 (certainly way past the 30-day lapse into law). The measure is one of the legislative priorities which Mr. Marcos identified in his first State of the Nation Address. It is also one of 42 priority bills that he submitted to the Legislative-Executive Development Advisory Council.

Risks? A mother handles it better. May not be risk-averse if you know how you will spend your money viz priorities. Riskprone if she sets aside income and expenditure, and lives on high financing. But that is a mother of a household, and we have a president in charge of 117,337,368 million Filipinos. Let us give MIF a chance? To be indebted further? To welcome back crony capitalism? Why can’t we instead give revising the Constitution an equal chance?