Lack of proper attention to risk management has helped fuel the credit crisis, finds a survey today.
Market turbulence this year has made organisations sit up and take notice of risk management. Almost 60% of financial services executives in a global July survey by the Economist Intelligence Unit, commissioned by SAS, said the credit crunch had galvanised them into taking a closer look at their risk management practices, particularly as they anticipated closer inspections from regulators.
Outside pressure from the Financial Stability Forum (FSF) and the Institute for International Finance (IIF) are also prompting risk management processes to come under the spotlight.
Lack of access to relevant, timely and consistent data was identified by respondents as holding them back from taking a more comprehensive approach to risk. Almost half pinpointed establishing a company culture or risk management as their biggest challenge.
In particular, SAS identified the need for a coordinated enterprise risk management strategy rather than individual pockets of excellence.
“This survey is evidence that the risk management needs of financial institutions are evolving to go beyond regulatory risk and must break down traditional risk silos to drive toward a firm-wide risk view,” said Alastair Sim, global director for risk, SAS.