Building new layers of talent in Banks
Coordination challenges are not what risk teams were historically built to overcome. Today, as risk has become a central and strategic part of the organization, complex co-ordination across functions, regions and business units is among many new strengths the risk function needs to build into its teams. Beyond quantitative skills, the risk management function is increasingly expected to bring value to the company by providing economic insights, generating new ideas and building strong relationships throughout the organization and beyond.
Smart technologies and new processes also change how risk teams interact with the business, regulators and other external stakeholders; calling for new skills and a balance of personalities across teams. Indeed, some of the most transformative innovations expected over the coming years are likely to be in how technologies are redesigned to complement and enhance human potential.
Over the years we have tracked the evolution of skills demand in banking risk management functions. For example, in 2009, at the time of the first Accenture Global Risk Management Study, financial market instability was the most pressing risk. Back then, just 7 percent of respondents thought technological change had the potential to cause a maximum increase in risk faced by the organization. Today, understanding emerging technology risks is one of the top priorities among 2017 respondents for strengthening risk management capabilities over the next year (see Figure 10).
A great deal has been achieved in this area in recent years. Nearly eight out of ten 2017 banking respondents (78 percent) say that their risk management workforce capabilities are effective or very effective at understanding emerging technology risks, such as cyber risks. Most (65 percent) agree that they have a cyber risk management function that can effectively support the IT function and accurately report to the board the real status of cyber risk.
Banks have clearly been building their cyber risk capabilities, but there is still a shortage of talent in this and other specialist areas. In fact, over the past few years the demand for relevant risk skills has intensified. In 2013, 51 percent said they had insufficient talent in the risk function and that this impeded the overall effectiveness of the organization’s risk management function. By 2015, this figure had jumped to 73 percent. This year, we separated core risk management skills from skills needed for new and emerging technologies, and found in both cases that 73 percent again agree that skills shortages in these areas impede the function.