风险文化与银行业：发展方向 RISK CULTURES AND BANKING WHERE NEXT

RISKCULTURESANDBANKING:

WHERENEXT?

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WeareACCA(theAssociationofCharteredCertified

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RISKCULTURESAND

BANKING:WHERENEXT?

Thisspecialreportlooksatwhatriskculturemeansforthebankingindustryasitfacesmajorstructuralandmacroeconomicshiftsinthemidstofthinningcapacitiestoadapt.BuildingonfindingsfromACCA’swiderreport,RiskCulture:BuildingResilienceandSeizingOpportunities(Johnson2023),andourongoingquarterlyGlobalRisksSurvey,weexaminehowthealreadyheavilyregulatedfinancialservicessectorhasrespondedtothechangingtidesofthepastyear,fromliquiditywoesandcorporatecollapsestorisinginterestratesandconsequentialgains.Throughourregionalroundtablesandone-on-onediscussionswithACCAmembersworkingatandwithbanksaroundtheworld,weexplorethepathaheadforthisindustryandthedifferentrolesourprofessionplaysinpavingthewayforward.

Author

RachaelJohnson,

HeadofRiskManagementandCorporateGovernance,ACCA

4

Contents

Guestpreface:TedMacDonald,FinancialMarketsStandardsBoard5

Executivesummary

7

1.Prioritisingcultureandgovernance

10

2.Rethinkingoperationalriskquantification

14

3.Theregulatoryconundrums

17

4.Theaccountancyprofession’sperspectives

21

5.Liftingthecloudedviewofbehaviour

27

6.Uncoveringleadershipblindspots

29

7.AI’sparadigmshift

32

8.Therelationshipbetweenriskandinternalaudit(IA)continuestoevolve

35

9.Accountabilityiskeyforsuccessfulriskcultures

40

Closingremarks:PavGill,Wirecardwhistle-blower

43

References

44

Appendix

46

Guestpreface

TedMacDonald

seniortechnicalspecialist,FinancialMarkets

StandardsBoard

Ahealthyrespectfortheneedtounderstandandnavigateriskaswellasanaspirationtobesuitablymindfulandproficientatdoingsoisnowbothapersonalandorganisationalimperative.Thisfacthasbeenunderlinedbyyearsofmisadventureacrossindustrygenerallybutdramaticallysoonceagainwiththefailuresofmajorfinancialinstitutions.

Theconceptofnavigationratherthanavoidanceisappropriatebecauseriskmanagementisaboutenablinggoodthingstohappenasmuchormoresothanensuringthatbad

thingsdonot.Thedynamicsofriskhavemoretodowiththeinfinitevarietyofhuman

behaviourthanthestatisticalprobabilitiesoftroublegeneratedbyamathematicalmodel.Itisalltooclearthattryingtomakesenseofacomplex,rapidlychangingworldrequiresfarmorethanadedicatedriskfunctioncanprovide.

CatastrophesinfinancialserviceslikeArchegosandSiliconValleyBankarearguably

explainedmorebyfailingsofstaffbehaviouratvariouslevelsthanbyflawsinpolicy

draftingorprocessdesign.Thefailingsalsoextendedfarbeyondthetypicalorganisational

footprintofRiskandCompliancefunctions.AstrongpartnershipbetweenRisk,othersupportunits,andespeciallytheaccountingfunctionscanmakeabigdifference.

5

RISKCULTURESANDBANKING:WHERENEXT?|GUESTPREFACE

6

Behaviourversusculture

Theterm‘culture’isoftencloakedinswirlingadjectives

andsweepinggeneralisations.However,itcanbequicklyelevatedabovethisfogbyfocusingontherelevant

behavioursthatunderpinkeyprinciplesandvaluesofa

firm,aprofessionorthespecificobjectivesofariskcontrolprocess.Individualbehaviourssupporttheachievement

ofdesiredoutcomes.Thecombinedterm‘riskculture’cansimilarlybeelevatedwhenthefocusofattentionisonkeybehavioursthatmatter.

Thefinancialservicesindustryrecentlytookastepbacktoassessitsprogressindevelopingeffectivemanagement

informationonconductandculture.Itfoundthatitwas

notspreadingitsattentionwidelyenoughorsufficiently

addressingspecific,unhelpfulbehaviours.Itisnowtakingstepstoaddressthis.Theselessonsintherecentreport

fromtheFinancialMarketsStandardsBoardcaneffectivelyapplytoindustryingeneral(FMSB2023).

Networkingandtellingthestory

RiskandComplianceteams,oftenreportingtogether

tothechiefriskofficer(CRO)inlargerbanks,operate

essentialcontrolandsupportinfrastructureandhavedeepconnectionsacrossthewholeorganisation.Alsoinfinancialservices,thechiefoperatingofficer(COO)oversees

anotherhighlyconnectedorganisationwithaccesstoveryusefulinformation.Butthestaffmemberswithperhapsthegreatestnetworkofallareinthefinanceandaccounting

functions.Theirrolestypicallyhavethemengaging

throughoutthewholeorganisationplacingtheminaprimepositiontocompareornoticedifferenceswithinoperatingunitsorwhenlookingacrossfunctionalboundaries.As

wellascompilingnumbers,thisenablesaccountingstafftogatherandthenrelateinsightfulobservationsorstoriesabouthowandwhythingsareactuallydone.

Wehaveacomfortablehabitofdescribingtheevolving

storyofanorganisationsolelywithnumbersthatassess

itsgrowth,revenues,profitabilityandforsome,quarterlyearningspershare.Buttheimportanthumanstoryofthecompanyismuchbroaderandrevolvesaroundpersonalandorganisationaldevelopment,community,marketimpact,resilience,skilldevelopmentandmuchmore.Numbers

doprovideasenseoforder,butstarknumericalsimplicitybarelyscratchesthesurface.Internalreportingshould

seektoelevatethebroaderstoryinclearandaccurate

terms.Itshouldbringtolifethestorybehindthenumberswithdecision-usefulcontext.Thisisaworthychallenge.

Enhancingcollaborationandbreakingdownsilos

Welivewithaconstantinflowofinformation,butitis

oftendevoidofchallengeordiversityofopinion.This

environmentbreedsriskratherthanenablingteamsto

addressandmitigateit.Collaborationisoftenrelegatedtobeingjustaprocessofseekinginputfromadditional

peopleaccompaniedbyworthyattemptsatinclusivity.

Infact,collaborationisafulldimensionofcharacterlikedrive,courage,justiceandaccountability.Itisanessentialareaforpersonalaswellasorganisationaldevelopmentifwearetomakemoresenseofdevelopmentsinatimelyfashion.Thisissimplyvitaltotheaccountingfunctions.

Riskandaccountingprofessionalscouldwellbecome

super-networkersandconveners,helpingteamsto

makegoodjudgementcalls,andaddressingtheneed

toshareknowledgewithintheorganisationaswellas

externally.Ultimately,allthesupportfunctionsneedto

raiseawareness,promotenewinformationandeffectivelyinfluenceeachotherandtherestoftheorganisation.

Storiescanhelpdothatandtheaccountingprofessionisperfectlyplacedtocontributesignificantly.

TedMacDonald,seniortechnicalspecialist,

FinancialMarketsStandardsBoard

RISKANDACCOUNTINGPROFESSIONALSCOULD

WELLBECOMESUPER-NETWORKERSANDCONVENERS,HELPINGTEAMSTOMAKEGOODJUDGEMENTCALLS,ANDADDRESSINGTHENEEDTOSHAREKNOWLEDGE

WITHINTHEORGANISATIONASWELLASEXTERNALLY.

RISKCULTURESANDBANKING:WHERENEXT?|EXECUTIVESUMMARY

7

Executivesummary

Thebankingcollapsesin2023highlightedtheneedforgreatertransparencyonissues

leadingtooperationallossesandreputationalriskatbanks,whichasaconsequenceiswhatastrongriskculturesupports.Trustedinformationiscrucialforbuildingresilienceandprudentialrisktakinginthefinancialservicesindustry,andthroughoutthisreportwediscusshowaccountancyprofessionalscanserveasriskculturesuper-networkers,aidingteamsinmakinginformeddecisionsandsharingknowledgewithinandoutsidethefirm.Bytellingthestories,ourprofessioncanraiseriskawareness,promotenew

insights,andeffectivelyinfluencetheperformanceoftheorganisation.

Learninglessonsandpavingthe

wayforward

Asgreenanddigitaltransitionsonlyfurtherincrease

stakeholders’expectations,howbanksandtheirregulatorslearnfromthe2023collapsesmightprovetobeoneofthemostcriticalchaptersinalifetimeforthefinancialservicesindustry.Fromariskcultureperspective,ACCAmembersfrombanksaroundtheworldhaveemphasisedthe

importanceofgainingafresh,morevigorousperspectiveon‘acceptednon-financialrisks’.

CreditSuisseadmitted‘materialweaknesses’initsinternalcontrolsoverfinancialreportingandriskassessmentsin

2022and2021,whichrelatedtothefailuretodesignandmaintainaneffectiveprocessforidentifyingtheriskof

materialmisstatementsinitsfinancialreporting.TheSwissFinancialMarketSupervisoryAuthority’sDecember2023

reportonthelessonslearntfromthecrisisalsostated

thatalthoughCreditSuissesatisfiedregulatorycapital

requirements,theywerenotenoughtopreventthebank’sdemise.ThemessagefromACCAmembersworldwideinthisindustrywasclear-cut:whilegreaterdialoguebetweenbanksandregulatorsisneeded,thereisacomplexitythatisfastbecomingrecognisedasa‘musttackle’forsuccessfulbankriskculturesandthatisbehaviouralscience.

Theriseofbehaviouralmetrics

RiskshavebecomesowidespreadthatmanyACCA

membersfrombanksusethewords‘threats’or‘hazards’instead,andsayitmakessensetofocusonthebehavioursbehindtherisksbecausebehaviourissomethingyou

canmeasure,monitor,andstrengthen.Adoptingamorebehaviourallyinformedapproachtounderstandingriskrequiresacknowledgingthekeypartoftheenvironmentindrivingbehaviourandacceptingdeepersystemicrootcauses.Formanagersthismeansadoptinganapproachthatreinforcestheirownresponsibilityandplacestheirownattitudesunderthespotlighttoo.

Understandingtheblindspotsandreasoningthatcan

cloudmanagement’svision,andinvestingininformed

behavioural-riskmethods,areallverycriticaltocraftingasuccessfulapproachtoriskmanagement.Uniqueamongrisks,behaviourisinfluencedbynumerouspowerfulbiasesthatareformidableobstaclestocreatingasuccessfulriskculture.Thefirststepistorecognisethis.

Perspectivesofaccountancyprofessionalsatbanks

Wediscusshowaccountancyprofessionalsinvariousrolesatbankshavebecomemorefocusedonhelpingturn

riskmanagementintoavalue-addedmindset,helping

institutionsmeettheirobjectives,especiallythoserelatedtothesustainabilityagenda,andthisincludesensuringtheintegrityofenvironmental,socialandgovernance(ESG)

reporting.However,respondentsworkinginriskroles

oftenexpressedfrustrationaboutnothavingthenecessarybuy-inandinvestmentduringsuchpivotaltimes.

Membersexplainhowrisksareincreasinglyinfluencingandexacerbatingoneanother,withmanyCROsandriskheadsalsopointingtogrowinggeopoliticalcomplexities

manifestingthroughsupplychaindisruptions,

ransomwares,andthird-partythreats.ThroughourquarterlyGlobalRisksSurveyweseehowpoliticalinstabilitytypicallyconcernsfinancialservicesrespondentsthroughthe

‘technology,data,andcybersecurity’lens,whileindividualsworkingatnon-financialcorporatesperceivesuchconcernsmoreas‘business-critical’risks,rangingfromtransportationissuestocustomerserviceandreputationrisks.

Leadershipsettingthecourse–

forsuccessorfailure

Itisimportanttoconsidertheleadershipriskperspectiveandhowthisinfluencesthedefinitions,decisions,

approaches,andreactionstoabank’sriskculture.Severalparticipantsinourbankingroundtablesalsobroughtupthenotionofhowtheriskdispositionoftheirleadersmay

RISKCULTURESANDBANKING:WHERENEXT?|EXECUTIVESUMMARY

affectperformance,andwefoundagrowingbodyof

literatureonthissubjectgiventheamountofaccessible

externaldataaboutbanksandthebackgroundsoftheir

executives.Understandinghowdifferentteamleaders

acrosstheorganisationthinkaboutrisk–forexample,whatisacceptableandwhatisnot–helpsmajordecisionmakersinfluencetheorganisationalbehaviouralchangeneededtoachievegoalsandturnthedialintherightdirection.

Additionally,wefoundthatmiddlemanagerswho

understandhowdifferentpeopleontheirteamdealwithriskarebetteratcapitalisingonthevariousindividual

strengthsofeachteammember.Thepointisthatstrongleadershipinvolvesanappreciationofperspectivesthatchallengeandcomplementeachotherinawaythat

createsvalueandsustainableinvestmentreturns.

AIischangingthebankingindustryfasterthanmeetstheeye

Unsurprisingly,thereporthighlightsthesignificantimpactofAIonbanking,particularlyinriskmanagementandtheinsightsitprovides.Bytheendof2023,somebankswereexploringwaystoidentifyconductrisksusingunstructureddatafromvariouscommunicationschannels,including

advancedanalyticstodetectpreviouslyunsuspected

behaviouralissuesandpatterns.Theseadvancements

providehighlyproductiveandpredictivecapabilities,buttheyalsohavepotentialunintendedconsequences.

ACCAmembersemphasisetheimportanceof

consideringbothexistingandnewusecasestogether,

asunderstandingthedesiredoutcomesandunintendedconsequencesiscrucialforstakeholdersandshareholders.Inthenearterm,newtechnologieslikechatbotsare

emerging,andwefoundseveralbanksconfiguring

variousversionsoftheirownin-house.Thevalueofthese

technologiesliesintheirtrueintegrationintobusiness

processes,anditwilltaketimefortheriskandcompliance

communitytoensuretheyoperateasexpected.

Accountancyprofessionalscanstrikeabalancebetween

numericaldataandwhatishappeninginpractice,whichis

essentialfordecisionmakingandmaintainingtrustduring

rapidtransformation.

Accountabilityandcollaborationacross

thethreelines

Thereportalsodelvesintohoworganisationsenhance

collaborationanddecisionmakingacrossthe‘three

lines’–whereriskandaccountancyprofessionalscome

together.Weexplainhowinstitutionscanensurethat

accountabilityisembeddedacrossteamsbydeploying

structural‘drivers’,reinforcingcoreactionssothatsenior

leadersareultimatelyaccountableforoutcomeswithin

theirremit.

Ourongoingdiscussionsabouttheevolvingrelationshipbetweenriskandethicscontinuestoshinealightonhowthisisbeingintegratedacrossthethreelines.Throughourbankingroundtables,wediscoverexamplesofdedicatedteamsofethicspractitionersbeingformedtodefine

policiesthathelpmitigateculturalandgovernancerisks.

Buildingastrongriskculturerequiresacollectiveeffort,

witheveryemployeeembracingaccountabilityasa

fundamentalsetofthreebehaviours:understanding,

acting,andrecording.Byimplementingthesedriversand

activators,institutionscanmitigateemergingrisksand

fosterahealthilybalancedriskculture.

8

RISKCULTURESANDBANKING:WHERENEXT?|EXECUTIVESUMMARY

9

Tenactionpointsforbanks

Ourspecialreportonriskculturesinthebankingindustryincludesalistofkeytakeawaysattheendofeachchaptertohelpriskandaccountancyprofessionalstakeaction.

1.Accountancyprofessionals

haveacrucialroleindeliveringeffectiveriskculturewithin

organisations,prioritisingvalueandriskmanagementeven

amidcuttingcosts.

6.Understandingdifferent

perspectivesonrisktaking

iscrucialfordecisionmakerstoinfluencebehaviouralchange,andshadowboardsand

employeetaskforcegroupscanmakeaprofounddifference.

2.Responsibleaccountingfor

operationalriskandnon-

financialrisksrequiresprecisemeasurement,transparent

reporting,andcontinuous

improvementinrisk

managementpractices.

7.Riskandfinancialprofessionalsmustconvenewithotherteamstoaddressthechallenges

posedbytheAIparadigmshiftandensurethesafeandethicaluseofAI.

3.Riskandfinancialleadersmustdemonstrateawarenessofriskcultureasacritical

riskgovernanceconcern

andcooperatewithregulatorsaboutwhatconstitutes

goodbehaviour.

8.Thethreelineshaveinevitablybeenblurredbythedisruptionoftoday’sdynamicrisk

landscape.Thisnecessitatesgreatercollaboration,agility

andinnovationforeffectiveriskgovernance.

4.Asbanksputmorefocuson

prioritisingrisksandidentifyingbehaviouralpatterns,

accountancyprofessionals

canhelpseniormanagementunderstandandpromote

positivebehaviourmore

strategically.

9.Accountabilityisessentialinpreventingbankfailures,andbusinessesshouldincentiviseandquantifyariskculturethatinvolveseveryonein

theorganisation.

5.Seniormanagementmustbe

awareofblindspotsandbiasesthatcanhindertheirapproachtoriskcultureandshould

assesstheirpreparedness

andknowledgeofrisksand

opportunitiesinaddressing

culturalconcerns.

10.ACCAprofessionalsshould

fulfiltheirjobrequirements

confidently,emphasising

vigilance,accountability,

andethicalpracticestopreventfurtherscandals.

RISKCULTURESANDBANKING:WHERENEXT?|1.PRIORITISINGCULTUREANDGOVERNANCE

10

1.Prioritisingculture

andgovernance

Thebankingturmoilinthefirstquarterof2023hasthrustbankriskmanagement

backintothelimelight,exposingculturalandgovernancecracksthatwouldmakeanysortoforganisationexceedinglyvulnerable,especiallywithtoday’stsunamiofchangeanduncertainty.Banksareinthebusinessoftakingonrisks,sothenecessityoffixingtheseblindspotsbeforeanothercrisisarisesisself-evident.Indeed,asthegreenand

digitaltransitionsonlyfurtherincreasestakeholders’expectations,howbanksand

theirregulatorslearnfromthe2023collapsesmightprovetobeoneofthemostcriticalchaptersinalifetimeforthefinancialservicesindustry.

Thechainofcollapses

ThecollapsesofFirstRepublicBank,SiliconValleyBank(SVB)andSignatureBankduringthefirstquarterof2023werethesecond-,third-,andfourth-largestbankfailuresinUShistory,respectively,smalleronlythanthecollapseofWashingtonMutualduringtheGlobalFinancialCrisis(GFC)in2007to2008.CreditSuisse,whichsince2011hadbeenonthe‘ListofGlobalSystemicallyImportantBanks’(G-SIBs)publishedbytheFinancialStabilityBoard(FSB

2022),wasbroughtdownbyasuccessionofscandals,

includingthebankruptcyofGreensillCapital,thesupply-chainfinancingbusinesstowhichithadlentbillionsof

dollars,andthefalloffamilyofficeArchegosCapital,whichresultedinmassivetradinglosses(FSB2023b).

CreditSuisse’stoxicculturewasexposedbyaseriesof

incidentsdemonstratingrecklessrisktakingandlackof

adherencetocontrols,anditsreputationwastarnishedtothepointthatstakeholderslostallconfidence.Thedemiseofallthesedifferenttypesandsizesofbanksisalltoo

typicalofwhathasbeenseenbefore,withthehedgefund,LongTermCapitalManagement(LTCM),HalifaxBank

ofScotland(HBOS),NorthernRock,LehmanBrothers,

AmericaInternationalGroup(AIG),andfinancialservicescompanyWachovia,amongothernotoriousexamples,

allofwhichhadprofoundimpactsontheeconomy.Lestweforget,theLIBOR(LondonInter-BankOfferedRate)

andINGbankscandals,whichalsohighlightedculturesofcollusion,laxcontrols,inadequatecustomerduediligenceandutterlackoftransparencyandaccountability.

PabloHernándezdeCos,thechairoftheBasel

CommitteeonBankingSupervisionandgovernoroftheBankofSpain,putthe2023collapsesintocontextinaspeechattheEurofiFinancialForumon14September2023,explainingthatitwasthemostsignificantsystem-widebankingstresseventsincetheGFCinbothscaleandscope:

‘Togiveyouasenseoftheorderofmagnitude,

thetotalvalueofthesebanks’assetsisroughly

equivalenttoSpain’sannualGDP,leavingasidethestockversusflownatureofthesenumbers.’

(HernándezdeCos2023)

Thesheerspeedofthecollapseswithinsuchashorttime–acceleratedbytheomnipresenceofsocialmedia–showedhowbanksnotidentifiedasG-SIBscanstillbesystemicallycrucialandcausecontagionandstressacrossthefinancialmarkets.ThefailureofafifthbankwitharoundUS$230bninassetsoccurredon1May2023.So,theinescapable

questionnowiswhatriskcultureandgovernance

improvementsdoweneedtomaketoavoidfuturecrises?

THEINESCAPABLEQUESTIONNOW,ISWHATRISKCULTUREANDGOVERNANCE

IMPROVEMENTSDOWE

NEEDTOMAKETOAVOIDFUTURECRISES?

RISKCULTURESANDBANKING:WHERENEXT?|1.PRIORITISINGCULTUREANDGOVERNANCE

11

CRISIS

CRISIS

CRISIS

CRISIS

CRISIS

CRISIS

CRISIS

CRISIS

Financialrisks

Non-financialrisks

Macro

prudential

analysis

Behaviour

&culture

Board

effectiveness

Thematic

investigations

(

Sound

operations

policy

Financial

reports

Compliance

Operational

risk

management

AML/CFT

Bench

marking

FIGURE1.1:Whatisriskculture?

Forwardlooking

Business

models

Stress

testing

Risk

management

Backwardlooking

Source:adaptedfromDrRogerMiles

RISKCULTUREISATERMDESCRIBINGTHEVALUES,

BELIEFS,KNOWLEDGE,ATTITUDES,CONDUCT,BEHAVIOURSANDUNDERSTANDINGABOUTRISK,ANDTHELEVELOF

ACCEPTEDRISKSHAREDBYAGROUPOFPEOPLEWHOHAVEACOMMONPURPOSE.

RISKCULTURESANDBANKING:WHERENEXT?|1.PRIORITISINGCULTUREANDGOVERNANCE

12

Reactionsfromregulators

Whilethemarketsseemedtomoveon,keybank

regulatorschurnedoutastringofassessmentsofthe

collapsesduringthesecondhalfof2023.TheBasel

CommitteeonBankingSupervision(BCBS)digestedthemanyflawsitfoundinitsReportontheBankingTurmoilof2023,includinglessonsthatregulatoryandsupervisorybodiesmustlearn(BCBS2023a).

‘fundamentalshortcomingsinbasicrisk

managementoftraditionalbankingrisks,suchasinterestrateriskandliquidityrisk,andvariousformsofconcentrationrisk;

.afailuretoappreciatehowvariousrisksthatwerebuildingupwereinterrelatedandcouldcompoundoneanother;

.inadequateandunsustainablebusiness

models,includinganexcessivefocuson

growthandshort-termprofitability(fuelledbyremunerationpolicies),attheexpenseofappropriateriskmanagement;

.apoorriskcultureandineffectivesenior

managementandboardoversight;and

.afailuretoadequatelyrespondtosupervisoryfeedbackandrecommendations.

(HernándezdeCos2023)

InitsownreviewoftheeventsofMarch2023,the

FSBfocusedontheeffectiveoperationalisationandimplementationofitsKeyAttributesofEffective

ResolutionRegimesforFinancialInstitutions,whichraisesmanydiscussionpointsonthesociallicenceofbanks

amidsterodingpublictrustinthem.(FSB2023b).

ReflectionsfromACCAmembers

ACCA’sriskcultureresearchcontinuestoseean

‘everything,everywhere,allatonce’environmentwhereeventhemostwell-capitalisedbanksfinditdifficultto

understandhowbehaviourstowardsandattitudesaboutriskaffecttheoverallhealthofthefirm.

‘Weseetimeandtimeagainthatboardsandseniormanagementaremoreconcernedwithquarterlyearningsanddonotpayenough

attentiontostrategicrisksandhowfasttheymaterialiseintosomethingverycostly.’

ACCAmember,UK

SeeABarticle,‘Areleadersrisk-ready?’(December2023).

‘Wehavealreadytalkedaboutthecaseforstrongriskcultures,sonowwithmorecostcuttingand

restructuringsthequestionforusasaprofessionis“howdowehelpfinancialinstitutions–andtheirregulators–restoretrustanddomoretoprevent

somethingsystemicfromhappeninginanalreadyshakyglobaleconomy?”’

AmemberofACCA’s‘GlobalForumforGovernance,RiskandPerformance’

ACCA’smajorreportfromApril2023,RiskCulture:

BuildingResilienceandSeizingOpportunities(Johnson2023),includes10callstoactiontohelpriskandfinancialleadersuseriskcultureasacompetitiveadvantagein

navigatingthestormywaters.ACCA’sreport,Internal

controlandtheTransformationofEntitiesisalsorelevantreading(Webb2022).

ACTIONPOINTS

Riskcultureiscentraltohowanyorganisationisledandmanaged,andaccountancyprofessionalsplayanintegralroleindeliveringaneffectiveriskculture.Thisisbecausetheiraccesstoinformationandinfluenceovermajordecisionmakersiskeytogettinganyaspectofanorganisationtowhereitanditsstakeholdersandshareholderswantittobe.

.Asorganisationsattempttoembedriskintostrategicdecisionmakingacrossallactivities,accountantsshouldaskthemselveswhatareastakepriorityandwhataddsvaluefortheirorganisationsegifweneedtocutcosts,canwestillmanageandtakeonriskeffectively?

.Thecomplexitiesofbanks’businessmodelsmeanaccountancyprofessionalsshouldbereviewingconflictswithstatedvaluesanddecidingwhetheropportunitiesareinlinewithdesiredbehaviours.Accountancyprofessionalsshould

alsobeexplicitlytaskedwithreconcilingethicswithprofits,especiallyduringtimesofrapidchangeanduncertainty.

RISKCULTURESANDBANKI