Author: Tony Scianna, executive vice president, SunGard’s brokerage & clearance business
This week I joined a group of my peers at FTF’s one-day 4th Annual OpRisk Workshop in New York. There were several speakers there sharing ideas and insight about risk, and I was fortunate enough to join Ilene Harker of Western Asset Management, Kate Leibfried of Citi and moderator Paul Zubulake of Aite Group on a panel called Enterprise Risk Management: Obstacles and Benefits.
Of course I am biased, but I believe the panel represented a timely and important discussion around enterprise risk and how critical ERM is today. In this blog post I wanted to share some points and ideas from the panel that may spark new questions and conversations around risk:
- Risk and exposure are more important now than ever. Today, we need to make sure we can get a holistic view of enterprise risk, which is complicated due to different asset classes, silos, etc. Still, the critical task is to know how to put it all together and be able to show your CEO the firm’s exposure to any given counterparty or country.
- Managers need to look at Key Risk Indicators and assess trends, issues and data to open a dialog with senior management and engage them in risk talk.
- Regarding regulation, we still don’t know exactly what will happen, but everyone knows things will change. Real-time will be very important; it won’t be enough to provide reports at the end of the month. Getting and managing data in real-time and putting it together is just the first step. Once that’s done, we need to determine how to assess and use the data when it comes to risk management.
- Right now it’s important to focus on establishing standards, understanding them and talking internally about risk.
- Creating standards and aggregating data will help, but it isn’t that simple.
What looming questions do you have when it comes to enterprise risk management? What is the best first step to take? How are you preparing for new regulations when it comes to ERM? Use the comments section to join the risk conversation.