In 2021, banks worldwide witnessed a transformational shift due to the introduction of operational resilience regulations. A new report, titled “Resilience Moves from Program to Performance,” by Celent, a leading global research and advisory firm, sheds light on this paradigm shift.
The Transformation in Operational Resilience
The operational resilience regulations brought forth a new regulatory environment for banks, sparking waves of transformation across the financial services industry. The risk and compliance teams within banks have now well begun the implementation of operational resilience programs such as DORA (Digital Operational Resilience Act), leading to a notable shift in responsibility. The Chief Risk Officers are now transitioning the responsibility for the day-to-day execution of operational resilience to the line of business executives.
Post-Implementation GRC Software Needs
One pertinent question that arises post-implementation is how a firm’s Governance, Risk, and Compliance (GRC) software needs will change. Should banks add an operational resilience module from their existing GRC vendor which focuses on compliance and documentation? Or would it be more beneficial to implement a software package explicitly designed for actively managing the resilience of the Financial Institution (FI)?
The Shift of Responsibility
With the final deadlines for regulations such as DORA and other operational resilience mandates across the globe having passed, the responsibility for resilience has now transitioned from the Risk and Compliance function to the lines of business. Line of Business (LOB) executives are now tasked with monitoring the resilience of the business and reporting it to senior management. Firms now need to make critical decisions regarding how actively they want to support these activities through enterprise risk management technology.
For more detailed insights on this topic, you can access the full report here.
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Source: Retail Banker International
