Understanding risk: separating fact from fiction

Recently prepared for a speech to the upcoming ICSA conference “It is difficult to make predictions,” the saying goes, “especially about the future.” Originating, apparently, with a Danish politician named Karl Steincke in the 1920s, the aphorism has been attributed variously to Mark Twain, Niels Bohr, Yogi Berra, Samuel Goldwyn, even Confucius. Which only goes…

Internal audit, going concern, Jessops and the sweep of history

An earlier version of this article appears on the ACCA e-newsletter here. With multiple UK high-street retailers failing since Christmas 2012, it is reasonable to ask ‘where were the internal auditors?’ and ‘where was these firms’ management of risk’?  The rash of failures in a single sector raises inevitable questions about the focus of risk…

Excuse me, how many lines of defence? The new financial Maginot lines . . .

Depending on your point of view, the ‘three lines of defence’ metaphor has its origins in either sport or in military planning.  It brings to mind three distinct lines operating independently; each ready to step in to save the day if the line before it crumbles.  In NFL, there can be three lines of defence…

Internal audit in financial services: a long time to wait for not very much

“Time is the old justice that examines all such offenders, and let Time try.” As You Like It, Act IV, Scene 1      As Canadian consultant Tim Leech pointed out in an ACCA column in 2009, internal auditors really didn’t have a good financial crisis.  Quite validly, Tim asked the question: Not being fingered for…

An agenda for improving corporate risk management

In the course of preparing a series of seminars we will be delivering in London this winter, we have focused on what an agenda or ‘manifesto’ for improving corporate risk performance would look like.  What should the firm do practically to improve its management of risk and uncertainty? The agenda has five items. 1. Better…

The truth about Neil Armstrong, Barclays, LIBOR, risk & culture

To go directly to the commentary paper, ‘Regulation, risk & culture: will we never learn?’, click here. The report of the parliamentary Treasury Committee on LIBOR appeared a week after the death of American astronaut, Neil Armstrong.  The two events are strangely linked by their relevance to culture – but separated by a yawning gap in the…

A voyage in oxymoron: a case study in ERM system selection

ERM is a broad church. Currently, it means different things to different people, depending on experience and discipline.  How far can the term be pushed before it loses meaning? In a recent chat thread, a US central government agency’s head of risk appealed for “an ERM system evaluation checklist” to be used “to compare features…