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14 March 2019 3 min read

Operational risk report

Baringa Partners’ Operational Risk Survey explores the top operational risks and resulting key themes in the financial services industry today.

The results show a wide range of management tools are currently deployed and highlight clear areas for development and improvement, particularly around the use of risk self-assessments and Key Risk Indicators.

Faced with growing regulatory pressures, shrinking budgets and increasingly sophisticated cyberattacks, functions are becoming more resourceful in their efforts to keep critical processes and services up and running.

Senior executives, including heads of operational risk, directors, and group leaders at the world’s biggest asset management, banking and insurance firms also noted the challenge and opportunity of balancing rapid technological change with heightened regulatoryexpectations.

Communication, transparency, and fostering a top-down culture of corporate responsibility and ethical conduct are considered the best ways to move business forward, but survey responses indicate these changes are difficult to execute in the short term.

Operational risk teams clearly understand they must better utilise resources and improve the flow and quality of information to management, as this allows for more effective decision-making at C-suite and board level, as well as strengthening the feedback loop.

Against this backdrop, we have identified several key challenges which we believe firms could benefit from addressing:

  • Transforming management information and associated governance
  • Improved controls rationalisation
  • Implementing a single IT operational risk system of record
  • Capturing and strengthening risk culture
  • Adopting/improving controls automation

Full report

To learn more about more the top operational risks and key themes in the financial services industry read our report.


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