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An effective Operational Risk framework can reduce losses, lower compliance costs, provide early threat detection, reduce exposure to future risks and minimise impacts.

The term Operational Risk is often used as a universal reference for a broad range of business related threats and is inherent in nearly all human and organisational endeavours. Operational Risk can be defined as the risk of loss (or gain) resulting from inadequate or failed internal processes, people and systems or from external events.

Blackhall & Pearl Approach

Our approach to Operational Risk encompasses:

Direction
  • Establishing an effective risk appetite framework, corporate values and appropriate incentives
Framework
  • Providing effective risk decision guidance through policies and risk integration in all key decision making
  • Establishing a high quality level of risk monitoring, reporting and training across the organisation
  • Linking risk management results to the performance management of staff
Systems
  • Establishing an accurate and transparent method for measuring operational risk based on historical losses
  • Supporting a robust control risk self-assessment program to ensure expected risks are managed effectively
  • Adopting an assimilated forward-looking scenario analysis process to plan for the impact of major crisis events

Client Benefits

Operational Risk is embedded in every facet of an organisation.

The benefits of effectively managing Operational Risk include:

  • Improved liquidity and use and allocation of financial capital
  • Improved organisational risk culture and employee risk behaviour
  • More consensual management behaviour
  • Improved reporting and decision making
  • Enhanced process, product and client management
  • Enhanced and more confident opportunity management
  • Stronger implementation of regulatory compliance requirements
  • Greater operational resilience (ability of a business process to adjust to or recover quickly from change, disturbance or misfortune)