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Risk and Governance: A Framework for Banking Organisations

By Sergio Scandizzo

Overview

Risk and Governance: A Framework for Banking Organisations examines the relationship between risk management and governance, both of which are at the heart of any corporation. Sergio Scandizzo addresses the manifold ways in which they both function in that most complex of corporations – the bank.


Publish date: 26 Apr 2013

Availability: In stock

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Risk and Governance: A Framework for Banking Organisations
£145.00
eBook - Risk and Governance: A Framework for Banking Organisations
EPUB
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Book description

Governance is defined as the way in which a company is controlled, through principles like the equitable treatment of shareholders, the protection of the interests of stakeholders, the ethical behaviour of the board, and the transparency and accountability of both management and the board. It is at the centre of any complex management system which enables a financial institution to function, a system which becomes even more complex when the corporation or company in question is a bank. Such institutions have huge numbers of people sharing in both risks and rewards, thereby implicating many more people in its decisions and potential losses.

A methodology which puts the relationship between risk management and governance at the centre of banking best practice has not yet been established. Risk and Governance: A Framework for Banking Organisations articulates the necessity of devising a new system of risk management which can cope with extreme conditions, examining the intrinsic limitations on governance, the role and evolution of risk management, and the strategies for best practice. Sergio’s contention is that risk management must become the key function of governance and the responsibility of the Board.

This book details the confluence of risk management activities and corporate governance mechanisms in modern banking into one integrated practice. It argues that the two processes, thus far confined respectively to the boardroom and to the back office, are inextricably linked, that their goals are complementary and that one cannot function without the other.

Risk and Governance: A Framework for Banking Organisations analyses the evolution and current thinking behind corporate governance, the rationale behind risk management - how it functions, why we need it, all potential risks faced by banks and the current models used to contend with them – and the necessity of using new models and strategies for banking best practice and corporate governance.

Key chapters include:

The Nature of Corporate Governance in Banking
The Mission, Organisation and Governance of Risk Management
Operations Risk in Extreme Market Conditions
Managing Reputational Risk
A Framework for Risk-Bearing Governance

Risk and Governance: A Framework for Banking Organisations is essential for anyone involved in the organisation and management of risk in a banking environment, from board members, directors, risk managers and regulators, to auditors, consultants, practitioners, and senior members of staff with the power to make strategic decisions.

Book details

ISBN
Book 9781906348878 / EBook 9781782720270
Publish date
26 Apr 2013
Format
Paperback
Size
155mm x 235mm

Author biography

Sergio Scandizzo

Sergio Scandizzo is the author of The Operational Risk Manager’s Guide, now in its second edition, and of Validation and Use Test in AMA, both published by Risk Books. Sergio was also a contributing author to the award-winning Risk Books title Advanced Measurement Approach to Operational Risk, edited by Ellen Davis. He is also Associate Editor of The Journal of Operational Risk and the author of several journal papers on fuzzy logic, genetic algorithms and risk management.

Sergio is currently Deputy Advisor at the European Investment Bank (EIB) in Luxembourg. Prior to his position at the EIB he was a principal in the London office of PricewaterhouseCoopers and, prior to that, a senior manager of the Operational Risk Group at the Canadian Imperial Bank of Commerce in Toronto. He holds degrees in computer science and finance.

Table of contents

Risk and Governance: A Framework for Banking Organisations

Sergio Scandizzo

Introduction: The Confluence of Risk and Governance

Part 1: Corporate Governance in Banking

Chapter 1: Corporate Governance, Information and Control

Chapter 2: The Nature of Corporate Governance in Banking

Chapter 3: Regulation and Governance

Part 2: Modern Risk Management

Chapter 4: The Mission, Organisation and Governance of Risk Management

Chapter 5: A Cartography of Banking Risks

Chapter 6: Operations Risk in Extreme Market Conditions

Chapter 7: Managing Legal Risk

Chapter 8: Managing Reputation Risk

Part 3: Current Practices in Banks

Chapter 9: Drawing Boards: Motivations and Responsibilities in the Boardroom

Chapter 10: Executive Compensation: Performance, Regulation and Ethics

Chapter 11: Fair Value, Auditing and Internal Controls

Chapter 12: A Framework for Risk-Bearing Governance

Conclusions

Testimonials

"In his book, Risk and GovernanceA Framework for Banking Organisations, Sergio Scandizzo tackles a subject that could be seen as relatively dry and technical, yet also is very topical in view of the intense debate about new bank regulations following the 2008 credit crisis.  He expounds his subject with his customary charm, insight and historical perspective.  Readers of his other books will recognise familiar philosophical references, whilst also finding within the accessible 200 pages a wealth of useful new material, both theoretical and practical.

The theme of the book is the confluence of risk management activities and corporate governance mechanisms, and how these interlink in modern banks.  Mr Scandizzo has advice for risk managers, auditors, regulators and other specialists, but above all he addresses boards of directors.  He concludes that a re-think of financial risk management is required, focusing on the survival of the organisation and of the wider financial system.  He calls for greater awareness from bank boards of all stakeholder needs, not just those of the shareholders.

The introduction begins in a novel way.  Relating risk and governance to the perils of shipping and the sea, Mr Scandizzo takes us back to Ancient Rome and an episode in the life of Virgil’s hero Aeneas.  Following this surprising start, the first main section of the book gives a brief tour of the essentials of corporate governance and how this has evolved in banks.  This is followed by a longer section on aspects of modern risk management, including chapters on how to manage legal risk and reputational risk, which I found particularly helpful since they are of increasing importance yet seldom covered well in risk textbooks.  The final section of the book is a wide-ranging survey of current practices in banks, covering topics such as the composition of boards, performance incentives and compensation, accounting and auditing issues, regulatory regimes, risk appetite and how best to report risks.  The role of the bank’s board in all these matters is continually emphasised.

Naturally, as readers of Mr Scandizzo’s other books will expect, there is a strong operational risk focus, but this is very much in keeping with the theme and indeed the overall direction modern risk management is taking.  Those of us who, as CROs, are charged with developing frameworks across all risk types, will find this book an excellent addition to the current literature on the subject, mixing compelling theoretical argument with a number of really useful practical tips and suggestions.  I can thoroughly recommend it."

Peter Harlow, Head of Risk at the ESM (July 2013)

Customer Reviews

Average customer reviews for Risk and Governance: A Framework for Banking Organisations

Essential publication for senior bank managers

This is an outstanding book by an individual who writes with the credibility of a public sector as well as an investment banking risk management background. Highly recommended
Review by Hennie , 10/03/2014

Thoroughly recommended

Those of us who, as CROs, are charged with developing frameworks across all risk types, will find this book an excellent addition to the current literature on the subject, mixing compelling theoretical argument with a number of really useful practical tips and suggestions. I can thoroughly recommend it.
Review by Peter Harlow, Head of Risk at the ESM , 25/07/2013

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