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THE CRO FORUM HAS PUBLISHED A GUIDE ON DEFINING, EMBEDDING and MANAGING RISK CULTURE
This guide, which is supported by SCOR, discusses the importance of risk culture.
It makes the point that no one risk culture is the “right one”, and that organizational culture plays a key role in creating the best environment for a risk culture to flourish. The guide specifically notes the need for broad support, from the board and executive management right through to the front lines, in terms of message, tone and behavior, in order to form and embed a sound risk culture. Although risk culture starts at the top, all employees should see themselves as risk managers and consider the risks involved in their everyday decision-making.
The paper investigates the essential hallmarks of a sound risk culture by providing examples of good and bad elements. The early detection of these indicators and (possible) red flags enables organizations to respond to risks in an adequate and timely manner. These practical examples illustrate how firms deal with designing, embedding, measuring and monitoring a sound risk culture.