Operational risk is facing a renaissance and could dominate the risk agenda of financial institutions for the next decade, says Hank Prybylski, global head of financial services risk management at Ernst & Young
Firms face a much increased regulatory burden with a growing emphasis on consumer protection that chief compliance officers must match. Regulatory attention in areas such as money laundering and tax evasion is forcing improvements in transaction surveillance. And firms must also standardise their approach to defining risk culture in the aftermath of episodes such as the Libor-fixing scandal.
Meanwhile, firms must also be mindful of the cost of controls. Efficient management of compliance frameworks and the optimisation or consolidation of controls will differentiate some firms over the coming years.
Questions covered in this interview include:
More on Operational Risk
Mixing, not scaling, best approach for using external losses
Conflict of interest poses operational risk if one part of group oversees affiliate
Capital requirements incentivise banks and insurers to enhance op risk management
Independent asset management firms catching up with bank- and insurance-owned peers
Sign up for Risk.net email alerts
Sponsored video: BAE Systems Applied Intelligence
Catch up with the debate at OpRisk's flagship London conference
Sponsored video: Elseware
Oxford professor David Vines argues that the carrot is as important as the stick
There are no comments submitted yet. Do you have an interesting opinion? Then be the first to post a comment.