How can you increase accountability and ownership through operational risk communication?

Ownership of risk profile of the organization from top level to the floors is essential. Risk is everyone’s business and needs to be monitored regularly. The boards have the ultimate responsibility to monitor risk and ensure that risk are mitigated and managed accordingly.

Effective operational risk communication can be a powerful tool to increase accountability and ownership within your team. Here are some key strategies to implement: - Define and communicate your risk appetite - Set clear expectations - Align individual roles with risk responsibilities - Involve your team in risk identification and assessment - Empower ownership - Utilize diverse perspectives - Use clear and consistent risk language - Avoid jargon and technical terms - Develop a common risk taxonomy - Communicate risks regularly and proactively - Don't wait for crises - Utilize multiple communication channels - Tailor your message to the recipient - Adjust communication based on severity - Encourage two-way communication - Lead by example

The insightful aspect of defining and communicating risk appetite lies in recognizing it as a dynamic and strategic tool. It transforms risk management from a constraint to an enabler, fostering a culture where risks are understood, accepted, and leveraged for organizational success. The emphasis on clear communication ensures that risk management becomes a shared responsibility, aligning individual and team actions with the organization's broader objectives.

Implementing these strategies can foster a culture that allows TMs to actively manage and mitigate risks: ? Clearly define the roles and responsibilities of each team member regarding operational risk management. ? Clearly communicate the expectations regarding accountability and ownership in managing operational risks. This helps create a sense of ownership and responsibility among team members. ? Encourage open and transparent communication regarding operational risks. ? Offer training programs and resources to enhance the risk management skills of your team members. ? Implement regular reporting mechanisms to track and monitor operational risks. ? As a leader, demonstrate accountability and ownership in your own actions and decisions.

Involving the team in risk identification and assessment is not just a practical approach but a strategic one. It taps into the collective intelligence of the workforce, fosters a culture of ownership and accountability, and transforms risk management into a collaborative and proactive endeavor. This insightful approach recognizes that effective risk management is not solely a function of leadership directives but a shared responsibility that permeates throughout the organization.

It's crucial for leaders to establish a culture where risks are not only discussed reactively in the face of challenges, but are also a consistent part of strategic conversations. By routinely communicating potential risks, during team meetings, leadership meetings or board meetings, teams can develop a heightened sense of awareness and preparedness. This approach fosters a proactive mindset, encouraging team members to anticipate challenges and consider their implications ahead of time. Regular risk communication also promotes a culture of transparency and trust, where team members feel more accountable for their roles and empowered to take ownership of their actions.

The key lies in encouraging a culture that views operational risks not as threats to avoid but as opportunities for individuals to demonstrate accountability and ownership. Instead of rigid communication, encourage open dialogue that invites team members to actively engage with potential risks, take ownership, and collectively strategize for effective mitigation.