Banks continue to struggle with the guidance provided by the Basel Committee on Banking Supervision with respect to risk data aggregation and reporting, contained in BCBS239. The Principles were designed to give banks the ability to gather and understand key risk data that is aligned with their risk tolerance and to improve risk reporting practices.
According to the committee’s most recent report, many banks continued to report noncompliance with some of the key principles. Lack of effective tools, unclear ownership of data and inconsistent business definitions across complex organizations are some of the key reasons behind the poor levels of compliance.
At Governor Software we agree with the BCBS239 rationale and truly believe that gathering, analyzing and actioning risk data in a controlled environment can give an organization a competitive edge.
As a result of this we have developed a product using cutting edge technology, which can significantly improve the aggregation and reporting capability. In addition, the tool allows for the definition of strategic objectives first, followed by the resulting risk factors, which means there is constantly a close link between the objectives of the business and the risks being taken.
Metrics can be captured at the most logical level, whether that be consolidated or by business division or customer type. Most importantly, thresholds can be set for all metrics (and aggregations of metrics) such that management can quickly identify areas of underperformance, drill down for a deeper understanding and then take appropriate actions to remediate the issue(s).