In the first quarter of each year, we hold a series of calls with leaders from our member firms to discuss their priorities for the next 12-18 months.
These calls help us identify new and developing trends in operational and non-financial risk (ONFR). They also give our members a chance to learn more about our plan for the year and provide feedback and insights. Read on for the key points from the discussions.
Top four focus areas
Conversations with Heads of Operational or Non-Financial Risk identified the top operational risks that are “keeping senior management awake at night”. The most frequently cited risks are:
- Information security
- Third party
- ESG and climate-related risks
- Geopolitical-related risk
Optimised and active risk management still top priorities
Overall, the priorities and activities of the firms we spoke to are broadly aligned with the two key themes of optimised risk management and active risk management that were identified in our 2021 report, Right time, right place: The drive for change in operational and non-financial risk.
How members are optimising risk management
Our members are seeking to strengthen and optimise business as usual activities performed by the risk management function. They want to be more efficient and more effective, generating more insights from the data they have and allowing more resource to be applied to active risk management. To achieve this, they are focussing on:
- Enhancing the control environment
- Moving to an internal process or value chain approach
- Improving risk metrics
Moving to more active risk management
Our conversations showed that work is also underway, often in parallel with opitimisation, to reshape the ONFR function into a more active, influential, and forward-thinking entity. One that stays ahead of threats and enables and informs business decisions at a strategic level allowing the firm to change safely.
There were three key ways our members are looking to achieve this shift:
- Understanding of ONFR profile
- Promoting cultural change
- Enhanced insights
