Global Risk Management Survey
Financial institutions have strengthened their capabilities to address market, credit, and liquidity risks, but are now facing a new set of demands as it confronts a number of looming nonfinancial risks. Banks will need to rethink their risk management approaches to meet these demands, from increasing their focus on nonfinancial risks to leveraging the latest AI technologies.
As they battle nontraditional competitors in a rapidly shifting marketplace, banking institutions are adopting new business models against a backdrop of economic threats and burgeoning nonfinancial risks. Successfully meeting these demands will require new approaches for risk management—intensifying management of nonfinancial risks, such as cybersecurity, conduct, fraud, data integrity, and third-party risk; leveraging the capabilities of digital technologies; enhancing risk data governance and IT systems; and reassessing the three lines of defense governance model. Banks will need to fundamentally transform their risk management approaches if they are to prosper in this rapidly evolving competitive environment.
Learn more in our banking spotlight, where we explore why banks will need to rethink their risk management approaches to meet these challenges.
Five key takeaways:
- Growing threats from cybersecurity risk
- Managing an array of nonfinancial risks
- Unleashing the power of digital risk management
- Strengthening risk data and IT systems
- Reassessing the three lines of defense model
Global Risk Management Survey, 11th edition
The 2018 survey interviewed chief risk officers or their equivalents at 94 financial institutions around the world, representing a total of US$29.1 trillion in aggregate assets.
The survey posed key questions on the current and developing risk management challenges these institutions face and the steps they’re taking to address them. The survey’s key findings include:
- Continued growing importance of cybersecurity risk
- Increasing focus on nonfinancial risks
- The potential of digital risk management
- Addressing the challenges in the three lines of defense risk governance model
- Increasing reliance on stress testing
- Stronger board oversight
- Widespread adoption of the chief risk officer (CRO) position
- Continued increase in the adoption of enterprise risk management (ERM)