In light of increasing regulatory scrutiny, financial institutions are expected to build, implement and maintain a comprehensive and effective enterprise risk management (ERM) program. Clearly defined risk parameters and limits as well as enforcement of associated policies and procedures must be communicated to ensure strong risk governance. All bank divisions must buy into the ERM approach and make risk management an inherent part of their decision-making processes.

Building a stronger and more effective enterprise risk management program starts with developing risk metrics and defining your institution’s appetite for risk. Your institution needs to assess and manage the critical risks your institution will be facing in the ever-changing risk environment.