Article
Risk management strategies for newly high-risk areas in financial institutions
May 22, 2023 · Authored by Chris Wetzel and David Merwin
In the wake of the COVID-19 pandemic, financial institutions now face emerging risks that have altered the landscape, highlighting the evolving need for effective risk management strategies in an ever-changing environment.
While cybersecurity and Bank secrecy act anti-money-laundering compliance addresses familiar risks, new risk areas now present their own challenges because of unforeseen changes in the following:
Talent management
The COVID-19 pandemic had an unprecedented, far-reaching effect on how many institutions began managing the workforce after office and branch closures made remote work necessary. Some organizations transitioned smoothly, others struggled, but few could dampen the rising employee stress levels felt across the financial industry. The resulting surge in employee turnover then brought talent management into the emerging high-risk landscape.
Talent management risks
Risks associated with talent management risk can be deconstructed as follows below.
Gaps in critical skills
Departing employees took their skills with them, often leaving disruptions to work volume, which proliferated strain and disengagement on people who were already stressed.
Challenges retaining and attracting top talent
With much of the workforce no longer restricted to physical locations in their local communities, a wave of employee relocation was felt throughout the finance industry and beyond, which escalated competition among institutions trying to attract and retain top talent.
