Blog

By Sophie Bottazzi, Senior Research Executive, CeFPro

The payment industry in Europe continues to evolve with the huge influx of new payments providers in the market, increased regulatory demand and evolving customer expectations of products and services. With the implementation of PSD2/Open Banking becoming more embedded, the payments landscape continues to evolve as APIs open up customer data for more institutions to leverage. With such increased demand and competition comes heightened regulato

marcus evans will host the 2^nd Annual Interest Rate Risk in the Banking Book Conference on December 5-7, 2018 in New York. This conference will give banks the practical insight to optimize their interest rate risk management strategies in an uncertain economic environment. Firms will gain insight into the regulatory priorities and concerns surrounding the proposed IRRBB regulation in order to streamline their strategies to position themselves for compliance. Delegates will also advance their ALM

marcus evans will host the 4^th Edition Leveraged Lending in the Shifting Regulatory Environment Conference on November 29-December 1, 2017 in New York, NY. This interactive meeting will provide you with best strategies to optimize your leveraged lending strategies in the current competitive environment. Take away insights for risk appetite setting, funding and regulatory compliance to increase profitability of leveraged loans.

Walk Away with Practical, Actionable Insights that will allow you to:

• G

Last month, SoulCycle, a well-known high-end cycling business, filed for an initial public offering. In the midst of this exciting transition from private to public, SoulCycle was hit with a lawsuit for violating the Credit Card Accountability and Disclosure Act. One might assume that the company was outed by a compliance agency or regulator. But, surprisingly, this lawsuit comes from a disgruntled former customer, Rachel Cody, who felt she was being "robbed" by the cycling mogul she once truste

Assessing and measuring risk appetite away from an investment portfolio is perhaps one of the most difficult risk management initiatives practitioners have to entertain, it is also discussed often on risk forums and written about avidly by many consulting firms.

In this article we release a white paper that steps through the entire process of measuring and assessing risk appetite, dealing with the numbers specifically rather than just top level summaries and catch phrases on what risk appetite is

There is always a lot of buzz about “risk appetite statements” and “risk tolerance.”  In theory, these sound like a natural launching point for ERM Programs – how can risk managers manage risks without a known goal of what they should be managing towards?

However, the problem with risk appetite is that it is not actionable, thus organizations see very little impact from having perfectly established risk appetite statements that far too many risk managers spend months developing..  As a result, se

The third step in the Risk Management and Own Risk and Solvency Assessment Model Act (RMORSA) is the implementation of a Risk Appetite and Tolerance Statement. This step is meant to sets boundaries on how much risk your organization is prepared to accept in the pursuit of its strategic objectives.

An organization-wide risk appetite statement provides direction for your organization and is a mandatory part of your assessment. As defined by COSO (one of the risk management standards measured in the

Ten years ago nine out of ten CFOs I was consulting to would tell me their CEO was too busy to meet to discuss the risk program under development.  The CFO was tasked with the job and we should just get on with it.  Today it is less likely to be a problem to meet with the CEO on risk, however, getting to the Board still seems to have its challenges for many risk professionals.  My experience is that “risk appetite” is one of the best tools to engage the Board.  This is how you can make it work:

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A recent survey carried out by KPMG and the Economist Intelligence Unit finds that 81% of risk managers and executives fail to effectively capture risk appetite in their business models, what can we do?

In this blog posting I have linked to the new KPMG Expectations of Risk Management survey and included an infographic for fixing risk appetite.

More can be found here [ LINK ]

Looking back over my most popular blogs, there was a lot of interest in 5 Steps for Better Risk Assessments and How to Consolidate Compliance Risk Assessments. Due to this interest I have created a complimentary 30 minute webinar on streamlining enterprise risk assessments complete with detailed "how to" examples and visuals that are not possible in a blog format.

Click here to watch this On Demand Webinar or read the full invitation below:

On-Demand Complimentary Webinar Invitation:

Organizations

I have had some very interesting conversations lately with Boards, Senior Managers and Risk Managers about risk appetite. Here are some insights:

Describing what we mean by risk appetite: Risk appetite is risk speak, however, it can be easily explained. With private sector firms I tend to describe using dollars as the example - "How much capital are you are willing to risk to try and make your forecast profit?" For not-for-profits I tend to bring it back to values - "What are you willing to do to

Risk Appetite is loosely defined as "the affinity a person has for taking risk when attempting to meet a specific objective".

This concept of risk appetite differs from person to person or business to business and interestingly you will find that a person's risk appetite changes as they age.

In this blog we look at risk appetite; what it is, where it has been used and why it is important.

[ Click here to continue reading ]

As a risk workshop facilitator I get to assist many organisations assess risk to their key organisational objectives.  Interestingly the outcomes are not always about risk treatments, often they are about reviewing risk appetite.

Situation One:

The results of the risk workshop show that three of five key strategic objectives have Extreme risk ratings.  This may be due to one of two scenarios:  Either you are an organisation that is on the edge of the cliff OR your risk criteria are simply wrong. 

Following the recent launch of Strategy & Risk Studio, Manigent have released a lite version of the application to allow users to download the product free of charge! 

Strategy & Risk Studio is a one-of-a-kind application enabling consultants and practitioners to design and define an organisation’s enterprise performance management, enterprise risk management and/or strategy and risk management models. The tool is based on the Risk-Based Performance Management approach, which integrates best prac

Risk Appetite Explained
In the face of the many recent failures of financial institutions, following market and asset crises and in the context of mounting regulatory demands from Basel 3, Solvency 2 and Dodd Frank, risk management is a topic high on the executive agenda. In particular, much emphasis has been placed on risk appetite and the role it has to play in an enterprise risk management approach, as part of an overall strategy execution process.

But what is Risk appetite?
First and foremos

Andrew Smart, CEO and founder of Manigent, a Strategy and Risk Management consultancy, has recently developed a whitepaper on designing an operational risk appetite statement. This paper outlines a seven step process which enables organisations to deliver an operational risk appetite statement which will meets regulatory obligations while adding real business value. This paper was recently featured in new e-magazine, The Risk Universe, which is a new online publication developed by industry prof

Risk managers are charged with ensuring transparency, alignment, and forward looking views throughout the organization.  The way this is achieved is through risk assessments. 

Successful enterprise risk assessments can be a powerful tool for board and management level strategic decision making by connecting business activities to goals and identifying the risks that threaten to derail these strategic objectives.  An unsuccessful risk assessment is little more than a form over substance activity t

An organization-wide risk appetite can be a powerful statement that gives your risk or compliance program direction.  However, like any policy, risk appetite without accompanying action is nothing more than an idea.

So how do you give your risk appetite teeth?  How do you make it an actionable guide for your organization?

Here are five recommendations to put your risk appetite into practice.

1. Translate risk appetite to the process level.

Every day your front-line managers are making operational de