Firm offers recommendations to prepare for new proposed enterprise risk management guidelines
CHICAGO (June 9, 2014) – Baker Tilly Virchow Krause, LLP (Baker Tilly) is helping banking organizations prepare to implement proposed enterprise risk management guidelines from the Office of the Comptroller of Currency (OCC) and International Risk Governance Council (IRGC). The company has published an article, Risk governance: What to expect, to help banks improve their risk governance practices.
“The proposed guidelines represent a shift in the formalization of enterprise risk management for banks,” said Timothy Kosiek, partner in Baker Tilly’s banking practice. “Currently, most banks have a subjective process for risk governance. The guidelines will make the process much more consistent across banking organizations. It will not be pain-free, but in the end, I believe it will be positive for the health of each organization.”
The article discusses the proposed guidelines that would, for the first time, require regulatory compliance for risk governance. The guidelines are provided within a framework of five elements:
- Risk pre-assessment: Early warning to provide a structured definition of the problem
- Risk appraisal: Combining a scientific risk assessment with a systematic concern assessment
- Characterization and evaluation: Using data to evaluate risk as acceptable, tolerable or intolerable
- Risk management: The actions and remedies needed to avoid, reduce, transfer or retain the risk
- Risk communication: Understand the risk and participate in the risk governance process
There are also hidden requirements within the proposed rules requiring quantitative risk measures, ownership of the risk governance framework and a definitive link between risk management and compensation.
The article suggests steps banks can take now to prepare for a formalized enterprise risk management process. Read the article online at www.bakertilly.com/insights/risk-governance-what-to-expect.
About Baker Tilly Virchow Krause, LLP (bakertilly.com)
Baker Tilly Virchow Krause, LLP (Baker Tilly) is a nationally recognized, full-service accounting and advisory firm whose specialized professionals connect with clients and their businesses through refreshing candor and clear industry insight. With approximately 2,700 employees across the United States, Baker Tilly is ranked as one of the 15 largest accounting and advisory firms in the country. Headquartered in Chicago, Baker Tilly is an independent member of Baker Tilly International, a worldwide network of independent accounting and business advisory firms in 147 territories, with 33,600 professionals. The combined worldwide revenue of independent member firms is $3.4 billion.