Tall order: why a unified op risk taxonomy is still elusive
Banks vary in how they classify operational risk losses – and regulators are in no rush to change the status quo
Humans have an innate urge to classify: to put things in boxes and label them. Witness Carl Linnaeus’s taxonomy of the natural world, published in the 18th century and still in use today.
In a similar spirit, the Basel Committee on Banking Supervision first classified operational risk loss events as part of its Basel II capital reforms. More recently, industry consortium ORX released its own
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