Risk USA: Hancock calls for a reappraisal of risk management

Instead, analysts should spend more time pondering possible unknowns. He said that in the past, a vulnerability identification test in which analysts are asked to describe the likely scenario where the firm would lose a lot of money has proved helpful.

Hancock also called for a more rigorous risk management framework which would include maintaining “risk balance sheets”, where the risk of the assets equal the risks of the liabilities. A systematic risk balance sheet would detail how much each