PARIS - Governments should boost their efforts to improve business continuity risk management in financial firms, according to a new report penned by the Organisation for Economic Co-operation and Development (OECD).
The report, entitled 'Innovation in country risk management' and produced in conjunction with Swiss Re and Oliver Wyman, has studied business continuity management in the US, UK, Canada, Japan, the Netherlands and Singapore.
The OECD says state authorities need to work more closely with the private sector to deal with crises quickly and cost-effectively, particularly in relation to the confluence of individual events into a larger crisis situation - as witnessed in the current financial turmoil.
"Government efforts to assess large-scale risks often focus on specific types of events such as a flood or earthquake," says Jack Radisch, risk policy analyst at the OECD. "There has been a tendency for ministries, departments and regulatory agencies at various levels of government to work in parallel and separate silos.
"This form of governance is far from optimal in today's interconnected world, where risks are more complex. The current financial turbulence is a telling example of how the management of risks we face in society should be co-ordinated from A to Z."
The report says there is good progress towards a co-ordinated "all hazards" risk approach for threats such as natural disasters, major accidents, terrorism or pandemic risks. Singapore, for example, is applauded for implementing its Whole-of-Government Integrated Risk Management framework, to improve risk awareness across government agencies.
The UK government received praise for educating the public about risks by publishing various scenarios through its National Risk Register, as did similar government initiatives in Holland and Japan.
To further reduce siloing of business continuity management, the OECD suggests nations create a "country risk officer" position mirroring the chief risk officer role found in corporate organisations.
The report may be downloaded here.
The week on Risk.net, December 2–8, 2016Receive this by email