There is no common job description for the risk officer, and where there is one, it is far from uniform.
But there is something important we do know: Risk officers become more important year after year.
Risk officers must:
- Manage the implementation of all aspects of the risk function, including implementation of processes, tools and systems to identify, assess, measure, manage, monitor and report risks.
- Assist in the development of and manage processes to identify and evaluate business areas' risks and risk and control self-assessments.
- Manage the process for developing risk policies and procedures, risk limits and approval authorities.
- Monitor major and critical risk issues.
- Manage the process for elevating control risks to more senior levels when appropriate.
- Manage the corporate risk and control assessment reporting process as well as manage and maintain infrastructure elements (e.g. management reporting, including reporting to senior management).
- Be leaders in developing and improving management reporting.
- Liaison with Business users to prepare Functional specifications.
- Generate project management documents.
- Prepare high-level user requirements to assist in preparation of Project Initiation Documents.
- Translate business requirements and functional needs into business / reporting and system specifications.
- Ensure technical specifications meet the stated needs of the business.
- Provide User Training for in-house developed systems.
- Conduct compliance & risk assessments.
- Conduct and document audits of client compliance to industry standards
- Document project plans, action plans, presentations and project results for clients.
- Define & produce client policies, procedures, processes & other documentation as required.
- Enhance the security architect function and be responsible for the end-to-end security architecture of applications, technologies and services.
- Implement the security program’s risk and control framework and global IT risk strategy.
- Ensure the program is effectively integrated into product development and delivery methodology.
- Participate in local and global discussions to formulate new or enhance existing security processes, policies and standards.
The independent risk management function (bank-wide and within subsidiaries) should have authority within the organisation to oversee the bank’s risk management activities.
Key activities of the risk management function should include:
• identifying material individual, aggregate and emerging risks;
• assessing these risks and measuring the bank’s exposure to them;
• supporting the board in its implementation, review and approval of the enterprise-wide risk governance framework which includes the bank’s risk culture, risk appetite, RAS and risk limits;
• ongoing monitoring of the risk-taking activities and risk exposures to ensure they are in line with the board-approved risk appetite, risk limits and corresponding capital or liquidity needs (ie capital planning);
• establishing an early warning or trigger system for breaches of the bank’s risk appetite or limits;
• influencing and, when necessary, challenging material risk decisions; and
• reporting to senior management and the board or risk committee, as appropriate, on all these items, including but not limited to proposing appropriate risk-mitigating actions.
While it is common for risk managers to work closely with individual business units, the risk management function should be sufficiently independent of the business units and should not be involved in revenue generation.
Such independence is an essential component of an effective risk management function, as is having access to all business lines that have the potential to generate material risk to the bank as well as to relevant risk-bearing subsidiaries and affiliates.
The risk management function should have a sufficient number of personnel who possess the requisite experience and qualifications, including market and product knowledge as well as command of risk disciplines
Staff should have the ability and willingness to effectively challenge business lines regarding all aspects of risk arising from the bank’s activities.