Top 5 operational risks in October 2020
- 6 November 2020
ORX, the world's leading operational risk management association for the financial sector, recently published an updated review of the top operational risks facing the financial industry today.
The study, based on the responses of operational risk professionals from among our membership, looked at which risks are top of the industry's agenda right now. Unsurprisingly, information security and cyber risk came out top, followed by third party and business continuity.
Top 5 operational risks (October 2020)
1. Information security and cyber
In the ORX Operational Risk Horizon study published at the start of the year, information security risk came out as the operational risk financial firms were most worried about. However, in the next risk review published by ORX (the Covid Risk Review) business continuity had overtaken information security and cyber – mainly because of the impact of the coronavirus (Covid-19) pandemic.
The latest risk review, published in October 2020, showed that after most firms demonstrated that they were able to respond successfully to the pandemic, information security and cyber was back in the top spot.
2. Third party
Our most recent study had third party at number 2, up from fifth in the May Risk Review. Third party didn't make the top 5 risks at the start of the year, showing the impact of coronavirus on this risk. It's being driven by global economic downturns and concerns around third party resilience.
3. Business continuity
With business continuity plans largely having been successful over the past 8 months or so, this risk has dropped from top place in May to number three. However, it remains high on the agenda with the need to maintain operational resilience in new operating environments a key driver.
Technology regained its place in the top 5 list. Out participants were very aware of their current reliance on technology to support remote working. And, although systems have successfully supported this shift so far, respondents were aware of the devastating impact of system failure on the operating environment
5. Regulatory compliance
Regulatory also made it back into the top 5. With a recent sharp increase in regulatory scrutiny and increased evidence of misconduct, respondents may be expecting this risk to continue rising.
Download the summary report to read more
Want to know more about the top operational risks facing financial firms right now? Then download the ORX Top Risk Review for more information and analysis.