Conduct and business disruption top concerns in scenarios library

  • 18 October 2020

Financial organisations are especially concerned about conduct and business disruption our latest analysis of the ORX Scenarios Library shows. The results, detailed in a freely available summary report, show that over 90% of firms submitted a conduct scenario to the library, while business disruption was a predominant theme.

The analysis was carried out on the scenario library, exclusively available to ORX Scenarios subscribers, which is a database of scenarios submitted by financial firms around the world. The library is refreshed annually as our subscribers submit their most severe scenarios for that year – it now consists of almost 1,000 scenarios.

Conduct most common scenario in 2020

No matter the location or size of the financial firm, conduct risk is considered to be one of the most material risks. The scenarios that were shared for this key risk covered things such as mis-selling and improper business practices. With the effects of the pandemic continuing to be felt, we expect that conduct will continue to be a focus over the coming years.

Business disruption a focus in 2020

This year, partly because of the increasing regulatory focus on resilience, ORX Scenarios subscribers chose to share business-disruption related scenarios for the first time. These scenarios covered a range of categories, including pandemic, cyber, and vendor failures. The drivers of business disruption were also varied, with natural disaster, public infrastructure outages and  IT-related execution errors among those mentioned.

The importance of reacting quickly

Our analysis also showed that agility is important for mitigating risk. Detecting and identifying issues as soon as possible and then and reacting quickly can hugely improve outcomes.

Get the report and more analysis

Download the free report for more information and in-depth analysis of scenario library. As well as the report, you can also watch our recorded webinar to hear our scenario experts discussing our findings (it's also available as a podcast if you'd prefer to listen to it)

Watch the webinar | Listen to the podcast | Download the report

Tools, data and resources for operational risk scenarios

At ORX, we understand that scenarios are an integral part of operational risk management. That’s why we created ORX Scenarios. ORX Scenarios gives you the tools and information you need to create and review operational risk scenarios, while also giving you the opportunity to become part of a global network of scenario experts.

Subscribing to ORX Scenarios means you can access a comprehensive library of almost 1,000 scenarios created by other financial firms worldwide. You’ll also be able to access a wide range of resources all designed to enhance and support scenario practice.

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Insights into Material Risks