TransConstellation members – Banksys, Euroclear, Fin-Force, SWIFT and The Bank of New York (Brussels office) - in partnership with PricewaterhouseCoopers, releases today a new benchmarking tool to measure operational risk management (ORM) maturity levels.
These leading companies in financial-transaction processing, all operating from Belgium, also provide a useful framework for precise actions to approach 'best practice' ORM maturity levels. This unique, step-by-step roadmap will help companies develop an ORM framework and/or validate existing ORM business practices through practical benchmarking and gap analysis.
The consequences of financial loss and damage to reputation can be severe without the requisite level of ORM maturity. This is of concern to most companies, but is particularly important in the financial sector where high-value, high-volume transfers of money and securities are involved.
Ignace R. Combes, Chairman of TransConstellation and Deputy CEO of Euroclear, said: "With a novel set of ORM maturity benchmarking tools, we aim to address the void in providing companies in the financial sector with practical means of determining where they stand compared with established ORM industry standards. In addition, we want to offer our industry colleagues useful and pragmatic advice on how to achieve higher levels of ORM maturity across all relevant areas. We strive to create the type of ORM environment where companies earn customer trust and respect, attract top-class talent, where employees flourish and regulators attest to full compliance."
"Meeting Basel II and other regulatory requirements, and in accordance with sensible business practices, ORM benchmarking against pre-determined objectives is now part of nearly every company's culture," stated Olivier Nagelmackers, Risk Manager at Banksys and TransConstellation ORM Project Manager. "It is vital to have the ability to identify your company's strengths and weaknesses in operating risk management, and to understand what steps to take and pitfalls to avoid in trying to improve your standing. The work TransConstellation has done to create a 'roadmap to ORM success' is indispensable for risk managers and senior management, Board members and audit committees, among others."
TransConstellation provides two complementary tools:
- The TransConstellation ORM Maturity Benchmark, a concise, practical document enabling qualitative assessment of current ORM business practices and how to improve them; and
- The TransConstellation ORM Reference Guide, a detailed study on the different ORM concepts and practices employed by top companies.
Research was conducted among leading firms in the financial-transaction processing industry specifically and among risk managers in other areas of the finance industry. Best practices are linked explicitly to the COSO The Committee of Sponsoring Organizations of the Treadway Commission II Enterprise Risk Management framework to maximize synergies among different risk-management initiatives already underway.