Risk Culture Plays a Critical Role in the Financial Services Industry

Risk Institute Portraits Fisher Hall - Third Floor Feb-02-2016 Photo by Jay LaPrete ©2016 Jay LaPrete

By  Philip S. Renaud II, MS, CPCU
Executive Director, The Risk Institute
The Ohio State University Fisher College of Business

 


The Risk Institute at The Ohio State University held the first in a series of breakfast sessions that focused on Risk Culture in the Financial Services Industry.

The session was moderated by The Risk Institute Academic Director Dr. Isil Erel who guided the discussion of the four-person panel of experts comprised of:

The session concentrated on how the financial crisis has elevated regulatory risk to a more central point in the discussion of risk management. The panel focused on how an organization’s culture is measured. Measurement can include the more traditional standard, regulatory approach with the evaluation of policies and/or process breaches to the softer side of culture that measures the “tone at the top.” The softer actions can include “raising your hand” when a process, policy and/or an ethical challenge is observed.

Panel Risk Culture Financial Institutions 3.2016

Helga Houston, Kevin Allard, Steve Chenenko, Rick Wilson

The panel went into an in-depth discourse for session attendees on how three levels of defense need to be present in an institution to evaluate the proper culture within. Those include:

  1. Business Unit oversight
  2. Risk Management oversight
  3. Auditor and/or Regulatory oversight

It is vital for all three oversights to be integrated in an organization’s risk culture. Furthermore, it is important to consistently gauge the organizational culture to evaluate if associates are doing the right thing, and whether they believe in the organization and what it stands for or if they are acting simply because they are instructed to do so.

The session proved thought-provoking and demonstrated The Risk Institute’s unique role in uniting industry thought leaders, academics and highly respected practitioners in an ongoing dialog to advance the understanding and evolution of risk management. The Risk Institute’s conversation about risk management is open and collaborative with its relevance across all industries and its potential as a tool for competitiveness and growth.


For more information about upcoming events, our students, partners or research, visit our website: fisher.osu.edu/centers/risk.

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