04.07.2019

What of Operational Risk ?

Many times trading company risk managers discuss the three primary focus areas of risk management departments as Market, Credit and Operational.

Being more quantifiable Market and Credit risk are easier to model and are often represented in nice graphical format in distributed risk reports.

It is a reality that operational risk assessment takes a back seat in management reporting. However, history has shown that inattention in this area has lead to some of the largest risk disasters. 

Operational risk must form the backbone of any risk strategy and boards should provide guidance and ensure there is assessment and inclusion in regular reporting. [Read More…]