Operational resilience may be among the largest regulatory and compliance burdens organizations face in the near future. Protiviti’s Ron Lefferts discusses the need for financial institutions to achieve better standards of operational resilience.
Operational disruptions are impacting the financial sector with greater frequency and severity, and with each disruptive episode, the focus on managing operational threats is changing from how financial institutions (FIs) can prevent events from happening to what they can do to minimize their impact or to restore services as quickly as possible.
While more regulators are demanding that firms and financial market infrastructures (FMIs) demonstrate greater resiliency, they are also considering regulatory approaches that are significantly different from those used to address capital, liquidity and the other financial risks. Operational resilience, which describes the ability of a firm to withstand an adverse event and continue to provide goods and services, is now at the forefront of regulatory scrutiny around the world.
Following is a framework firms can leverage to understand, prevent and recover from extreme but plausible events. The framework identifies key components firms must consider when formalizing and managing the resilience of their critical business…
