According to a new report by research firm Chartis, integrated risk management is playing a more strategic role within financial institutions, with the trend set to continue as the tactical and functional execution of risk begins to align with strategy. However, the report, sponsored by software and IT services firm SunGard, also indicated that most firms were behind in realizing the execution of risk management as an integral part of their investment strategy.
This report explores the role of risk management, the importance of establishing a firm wide risk strategy and the related challenges and helps to explain the importance of and how to implement an integrated risk management strategy.
The analysis found that risk management is seen as an integral and crucial component of investment strategy across 89% of respondents. However, a large disparity exists between participants understanding the importance of risk and the reality of day-to-day execution within their firms.
When asked to identify the top risk management challenges and where organizations would benefit from improved use of risk data, analytics and reporting 90% of respondents ranked better transparency and interactivity of risk analytics and 87% said improving granularity or frequency of risk reporting for internal stakeholders. In addition, 91% reported data quality was a significant or important challenge, while 87% cited risk data aggregation.
“The on-demand aspect of risk is increasing at the C-level, and they do not want to have to wait for scenarios or reports,” Peyman Mestchian, managing partner at Chartis Research.
Click here to view the report.