Operational Risk Advanced Concepts

Operational Risk Advanced Concepts

Paul Rosen

Operational Risk

Having discussed the various stages of the operational risk cycle, in this video, Paul Rosen provides some key takeaways and outlines some topics that may elicit further research.

Having discussed the various stages of the operational risk cycle, in this video, Paul Rosen provides some key takeaways and outlines some topics that may elicit further research.

Speak to an expert

Speak to an expert today to access this and all of the content on our platform.

Operational Risk Advanced Concepts

3 mins 44 secs

Overview

Good operational risk management reaffirms the saying “when done right, the whole is synergistically greater than the sum of the parts”. A good organisational culture goes hand in hand with the implementation of good ORM. These in turn, deliver business outcomes brilliantly.

Key learning objectives:

  • Understand how a good organisational culture is needed for good ORM

Speak to an expert

Speak to an expert today to access this and all of the content on our platform.

Summary

How to ensure an environment that supports good operational risk management?

More than the theoretical presence of the operational risk cycle, it is the implementation of a risk culture that generates effective practice. Management needs to ensure that all colleagues understand their responsibilities and create a culture that is focused on business outcomes rather than managing operational risk itself. Management should reinforce culture through role-modelling good practice and eliminate blame culture. This will help in the long run and allow mistakes to be escalated and remediation activity to take place openly. This will allow more equitable distribution of resources and better access to senior management who can assist in issue closure.

As part of good practice and formally as part of their Internal Capital Adequacy Assessment Process (ICAAP), financial institutions forecast potential future risks and their impact. For example, technology is a big risk to organisations and a scenario exercise may include a test against a cyberattack or ransomware playbook. This scenario analysis demonstrates what could go wrong under a set of extreme but plausible circumstances. The results from such tests are also used to review management strategic direction and also contribute to the firm’s capital calculations.

This example of operational risk’s connection to the ICAAP, and Prudential Regulation Authority’s new Operational Resilience requirements, are a frequent reminder of the connection between understanding operational risk and responding across a range of teams, areas and processes within a large bank. 

Speak to an expert

Speak to an expert today to access this and all of the content on our platform.

Paul Rosen

Paul Rosen

Paul Rosen is responsible for the First Line of Defence, Front Office Regulatory Advisory and Operational Resilience at NatWest. He previously worked in the Williams & Glyn divestment from the Royal Bank of Scotland. He is a fellow of the Institute of Chartered Accountants in England & Wales and a member of the Association of Corporate Treasurers.

There are no available videos from "Paul Rosen"