Operational Risk - Mitratech

Operational Risk

Operational risk exists in every organization, regardless of size, complexity, location, or industry. Simply stated, it is the risk arising from the execution of an organization’s business functions. In today’s ever-changing world, operational risks are everywhere, from catastrophic events, computer hacking, or internal and external fraud, to the failure to adhere to internal policies. In the most extreme cases, management of operational risk can protect your organization from ruinous operational losses, but the main benefit of proactive management is the early detection of unlawful activities and reduced exposure to future risks.

Operational Risk

How our operational risk solutions solved similar challenges for our clients

Organizations need to understand that the management of operational risk is a continuous cyclical process, which includes risk assessment, risk decision making, and implementation of risk controls – as well as the communication of these policies, processes, and findings back to the organization. The failure to close this communication loop creates islands of operational risk management, and lessens the effectiveness of the risk management across the organization.

Our clients are able to articulate to both auditors and regulators that inherent risks are being duly mitigated and residual values are accurate, both for the current and historic periods. Individual department managers can easily identify risks they own and see the current status, while also maintaining clear oversight. We know not every operational risk can be avoided, but with the right solution in place, your organization ensures every control and mitigation effort is complete – and completely tracked.

All stakeholders, including prospective clients, want to see organizations embed Operational Risk Management into everyday processes at all levels of the business to ensure good governance. This provides our clients and their business partners an increased level of confidence and trust when considering a long term business relationship.

Our recent thought leadership piece, Conduct Risk, highlights why our current environment makes managing Operational Risk so important. “In a year when multi-million-pound regulatory fines were issued by the Financial Conduct Authority (FCA) for manipulation of benchmarks, conflicts of interest, IT system failures, bribery and corruption…the FCA wants to make certain that boards and senior management are taking a closer look at mitigating Conduct Risk.”