Looking through the holidays into 2010 there are four clear priorities for risk management that cut across all tiers with financial institutions. Over the last year the pendulum has swung from the exotic to the pragmatic, from chaos to order within financial services. The four priorities for risk in 2010 can be derived from the word D.A.T.A.(data, analysis, transparency, accuracy).
Scouring through the internet one can find many interesting articles and research articles on priorities for 2010 but this is the first one I have found that is stating the practically obvious.
These four areas being data, analysis, transparency and accuracy are four key areas that have been applicable for any business process. I spent 12 months lecturing at the University of Melbourne on this exact topic – a subject called Information, Process and Control as part of the Masters of Business and Information Technology. On a related topic whilst you are at the University of Melbourne site watch the video relating to an award for knowledge transfer on risk management (you will need to scroll down approximately 7 videos).
Essentially these four areas are critical to any successful business process and risk management is just like any other business process. It relies on data which needs to be analysed with transparency of rules relating to the data and accuracy of the information used in the decision making process. These same rules apply for all the key risk categories considered by financial institutions being credit risk, operational risk, market risk and non-traded market risk.
It is surprising to see such a simple analysis of key priorities but these priorities are applicable in all years and under all circumstances.
It makes me realise just how important lecturing in this subject was to the risk professional and I look forward to getting back into the lecturing fold in the second half of 2010.