Your Risk and Control Self-Assessment (RCSA) should ideally reflect your real Risk Profile, but there are reasons why this may not be the case. Your RCSA will reflect your risk profile only if management have been involved in the process.
The industry has long been challenged with implementing the concept of operational risk stress testing and operational risk scenario analysis. In practice, these two methods of extreme risk analysis should be linked and used as a combined approach to investigating
Operational risk and control assessments are often the first process that a firm uses to conduct operational risk management. Frequently the assessment is carried out without an operational risk management framework in place and without much thought being given to
Good risk governance is required by the FSA through its Principles for Business (Principle 3). The European Union, through its draft of the Capital Requirements Directive also requires robust governance arrangements in relation to risk management. There are also many
Op risk professionals must revisit their attitude to qualitative data. John Kiddy, CEO of Chase Cooper, says we must stop thinking of it as ‘just’ qualitative data and view it as a precious source of intellectual capital. Most operational risk
The standard model in Solvency II is totally inadequate for operational risk. Many in the industry know this. But nothing is likely to change before 2012. “How to treat operational risk has been a very important question from the start
“That men do not learn very much from the lessons of history is the most important of all the lessons that history has to teach.” – Aldous Huxley It is to be hoped that by now, every financial institution that
Governance, risk and compliance as a concept now permeates the risk management airwaves in the same way that enterprise risk management did three years ago. Most risk management software vendors are trampling over each other to be the first to
The unprecedented and catastrophic failure in risk management by industry participants, regulators and governments over the past 18 months has put the spotlight on the way that banks handle risks and their governance and compliance capabilities. It must also lead
Six Sigma is in essence a structured methodology to systematically improve processes by eliminating defects. The ideas and practices came out of manufacturing in the mid-1980s and have been reported as having generated many billions of dollars in shareholder value.