QUESTION:  What is Operational Resilience?

Resilience risk is the risk that the firm is unable to continue business operations and provide service to clients in a business as usual manner.

Resilience is the state that firms should strive for and is the business’ ability to run uninterrupted from both an internal and external standpoint when a crisis event occurs.

Proper resilience planning is the ability to demonstrate to regulators that there is a resilience operating model that can function at times of stress. Regulators care mostly about market and client protection and want to know that firms are able to effectively manage their clients’ money in crisis scenarios.

QUESTION: Who is accountable for Resilience?

The accountability for resilience sits with Head of Operational Risk.

The Head of BCM plays a key role and reports into Head of Operational Risk, who in turn reports into the Chief Risk Officer.

QUESTION: What roles have you created or changed?

No new roles have been created to focus on resilience and there has not been specific external hiring related to resilience.

QUESTION: What have you learnt from COVID-19?

That the resilience plan we, as an organisation, had in place to deal with a crisis situation was outstanding. It showed everyone within the organisation that if you plan ahead and stress test your risk function, it pays off.

They are one of the organisations that, prior to COVID-19 had seen the importance of and had focused heavily on resilience planning and have benefited from that.

On a practical level, to be properly prepared, organisations need to have the right technology to support home working. They also need core productivity and core infrastructure tested.

INTERVIEW END

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Leathwaite recently executed a series of interviews with global heads of Risk to understand how organisations across all sectors have been implementing crisis plans.

Since lockdown began, organisations across all sectors have been implementing crisis plans. We were keen to understand what financial services firms globally had put in place over the last year; since regulators, particularly in the UK, began to make stipulations around process mapping, understanding of impact tolerances and running increased scenario testing.

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