Business Continuity Challenges and Strategies

During the recent installment of the Credit Risk Management Audio Conference Series, Eric Holmquist, managing principal of Enterprise Risk Management and Scott Ramsay, managing principal of Cybersecurity & Resiliency Services both at Capco, shared best practices to incorporate into your bank's ERM plan.

In an advanced notice of proposed rulemaking issued in November 2016, the Fed, the Office of the Comptroller of the Currency, and the FDIC stated that financial institutions should be capable of a two-hour return to operations (RTO) following a cyber attack. With this being the expectation, institutions need to prepare accordingly.

Today’s reliance on IT-related service continuance for business operation is changing the view of business continuity from a catastrophic event orientation to an operational risk management perspective. The business environment has near zero tolerance for service outages and disruptions. So it’s not enough to simply develop strategic resilience plans; those plans must be continually tested, validated, and trusted to help reduce risk and better manage compliance with regulations.

Enterprise risk management frameworks should take a holistic approach, taking into account business continuity management and resilience. BCMR identifies risks and vulnerabilities to continued business operations and either mitigates or eliminates them. A strong plan implements effective resiliency strategies to ensure continued operations of key business processes, restores time sensitive business processes to an acceptable level of operations within defined timeframes, minimizes financial and operational impacts of the disruption, and safeguards the survival of the organization.

BCMR also places a governance framework in place so that continuity and recovery plans, enterprise-wide training and education, and appropriate testing and exercising of strategies remain current. Employee involvement and understanding of their roles, as well as frequently changing personnel as part of testing are essential. Ultimately, BCMR protects the brand, image, C-suite, and stakeholders in the event of a crisis situation.

Please join us on September 11, 2018 for the start of the 2018–19 Credit Risk Management Audio Conference Series.

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