Special
OPERATIONAL RISK
Guidance for sound practice A series of papers on key aspects of operational risk aim to help improve best practice in risk appetite, risk culture and embedding risk BY SARAH WINT
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lthough there is no one-size-fits-all approach to the management of operational risk, it is important that organisations benchmark and improve their practice on a regular basis. That is why a series of papers by the Institute of Operational Risk (IOR) – part of the IRM group – aims to provide practical guidance on a range of important topics that span the discipline of operational risk management. Broadly, the objectives of these papers – which include guidance on risk appetite, culture and embedding risk management – include explaining how to design and implement a sound (robust and effective) operational risk management framework (ORMF), as well as demonstrating the value of operational risk management. The guidance papers also reflect the experiences of risk professionals and provide insight into the challenges involved in developing ORMFs.
The guidance papers reflect the experiences of risk professionals and provide insight into the challenges involved in developing operational risk management frameworks
Risk appetite The starting point of the Operational risk appetite and tolerance operational risk: sound practice guidance is IRM’s definition of risk appetite: “The amount and type of risk that an organisation is willing to take in order to meet their strategic objectives”. The guidance notes that in many firms the current practice is for the board to consider risk appetite
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Enterprise Risk
