Only 14 percent of banks worldwide have a consolidated view of their risk positions, according to the second-annual risk governance survey by Ernst & Young. Even worse, say E&Y officials, only 16 percent have a “well-defined, shared vision” of how the enterprise risk picture should be structured.
The survey of 48 executives at nearly 40 global banks indicates that silos, disparate decisioning, inadequate forecasting and non-transparent reporting remain as barriers—this despite 86 percent of respondents stating that their institutions have comprehensive risk-view projects under way.
Most agreed poor data quality, gaps in data flow, and the sheer volume of data were challenges, but only nine percent have been able to aggregate data across the enterprise. “In last year's study, identifying emerging risk was reported to be a relatively low priority on the path to better risk management,” says Hank Prybylski, head of Ernst & Young's Global Financial Services Risk Management practice, in a statement. “The current crisis demonstrates the need for firms to focus on emerging and unforeseen risk.”