The global financial crisis has financial institutions running scared and looking to conduct a thorough overhaul of their risk management procedures, according to a global study conducted by Economist Intelligence Unit on behalf of SAS.
The global survey of 334 financial services executives revealed only 33 percent believe their principles of risk management in financial services remain sound and are confident that policy-makers can formulate an effective response to the current economic crisis.
More than half are planning to, or already have, conduct a thorough overhaul of their risk management, including improvements to data quality and availability, strengthening risk governance, moving towards a firm-wide approach to risk, and deeper integration of risk within the business.
According to Tower Group Senior Research Director Virginia Garcia, the survey’s findings underscore the need for financial institutions to look more closely into their risk management strategies.
“Although technology is not to blame for the widespread financial crisis, rigid technology and business processes have undoubtedly made it difficult for many to respond rapidly and effectively to the financial crisis.”
Businesses identified poor data quality, lack of expertise and a lack of risk culture among the broader business as barriers to improving risk management in their organization.
