Compliance Risk Management – Risk mitigation and reporting

Risk mitigation and trade-off The treatment of compliance risks refers to the corresponding strategies implemented by an organization to deal with its risks. A risk treatment plan should consider a range of treatment options, which may include legal remedies as well as financial, operational and reputational remedies for each prioritized risk. The following factors should… Continue reading Compliance Risk Management – Risk mitigation and reporting

Compliance Risk Management – Risk analysis (part 5)

Step 5. Measure the effect of risks on decisions In order to account for the uncertainty both in the consequences of each scenario and its weight, consequence distributions are multiplied by weight distributions using the Monte-Carlo simulation method. Normally 10000 simulation runs should be sufficient for most compliance risks, however more simulation runs may be… Continue reading Compliance Risk Management – Risk analysis (part 5)

Mark Powell – The lost art of building risk matrices and why they should be avoided

Risk matrices have been around for decades, but most people don’t build their own anymore. In fact, Mark Powell told an audience at Risk Awareness Week 2020 that he hadn’t met anybody in 25 years who had built a risk matrix from scratch, with many outsourcing the job to consultants instead. So why does this… Continue reading Mark Powell – The lost art of building risk matrices and why they should be avoided

Compliance Risk Management – Risk analysis (part 4)

Step 4. Allocate weights to each scenario In order to determine the weight allocated to each consequence scenario of events triggered by compliance risk, historical data, modelling, as well as expert opinions, can all be used, individually or in combination. Weight of each scenario can involve the following factors: the range of laws, along with… Continue reading Compliance Risk Management – Risk analysis (part 4)

Compliance Risk Management – Risk analysis (part 3)

Step 3. Determine the range of consequences for each scenario In order to quantitatively assess compliance risks the next step involves defining the possible range of values for each consequence scenario. Typical consequences can involve the following factors: Consequence scenario Range of consequences A.     Small fine for violation, for example a fine for three days… Continue reading Compliance Risk Management – Risk analysis (part 3)

Compliance Risk Management – Risk analysis (part 2)

Step 2. Identify causes and consequence scenarios Causes and consequences for the bow-tie diagram are normally derived from the regulations as well as through consultation with risk owners and subject matter experts. Common consequence scenarios for compliance risks (just a quick example, there is more) include: Risk area Examples of consequence scenarios Licensed activities and… Continue reading Compliance Risk Management – Risk analysis (part 2)

Compliance Risk Management – Risk analysis (part 1)

Wherever possible companies should apply quantitative risk analysis to measure and prioritize compliance risks. Wait what? We can do better than a compliance heatmap? Apparently :)) The following information should be collected and recorded for each identified risk: Possible consequence scenarios as described in the legislation or other regulatory requirements (usually includes fines, 3rd party… Continue reading Compliance Risk Management – Risk analysis (part 1)

Alex Sidorenko – Why businesses and decision-makers must embrace Risk Management 2

One major flaw in the risk management industry is that the commonly adhered to standards and practices are built on theories that have no basis in scientific fact. Indeed, risk managers have become bogged down in appetite statements and risk registers which have little or no bearing on improving actual decision-making. But how have things… Continue reading Alex Sidorenko – Why businesses and decision-makers must embrace Risk Management 2

BLACK FRIDAY – Free access to all RAW2020 workshops until 28.11.2020

RISK MANAGEMENT AWARENESS is the biggest online platform to learn about risk management and decision making. Amazing lineup of international speakers have recorded practical case studies on integrating risk management into decision making, planning, project management, performance management and core business processes. You can watch the workshops any time on your phone, computer or tablet. More… Continue reading BLACK FRIDAY – Free access to all RAW2020 workshops until 28.11.2020

45 risk management and decision making workshops available on demand

Every year I ask the best quant risk and decision making professionals I can find to share their models, simulations, methodologies and case studies with the public. We call it RISK AWARENESS WEEK and it runs for a week in October. Every year more than 3000 participants from 100+ countries take part and 2020 was… Continue reading 45 risk management and decision making workshops available on demand