“If you are coming out of what we have been through for the last two years and can't communicate the need for a culture of risk, then shame on you.” – Survey respondent
Banks are on a multiple-year journey to instill a mindset of awareness and ownership of risk.
For many banks, making risk "everyone's business" represents a significant shift in mindset, policies, systems and processes, and involves a long-term commitment and investment. More than 70% of interviewees indicated they are making progress in their efforts to institutionalize an appropriate risk culture throughout the organization. At the same time, only 23% believe they are close to the end of the process.
Shifting the culture
Respondents are well aware of the many challenges to overcome before a risk mindset can truly be part of the organizational fabric. Among the major barriers cited were organizational silos, decentralization of resources and decision making, lack of integrated data management and delivery, and the inherent complexities of operating globally.
Management attention to risk culture
While discussions on methods to address these challenges varied, opinions on best practices essentially focused around four critical activities:
- Start at the top
- Clearly define roles and responsibilities
- Establish accountability
- Reinforce change with communication and training
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