By Beate Born, Executive Director, Risk Management, UBS.
Beate will also be speaking at the upcoming New Generation Operational Risk: Europe 2019 Summit in London (12-13 March).
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Beate, can you please tell the Risk Insights readers a little bit about yourself and what your current professional focus is?
I am an Executive Director at UBS in Zürich where I generally run global operational risk and regulatory projects for the Wealth Management Division. Most recent projects include MiFIDII and Brexit.
What, for you, are the benefits of attending a conference like the ‘New Generation Operational Risk: Europe’? What can attendees expect to learn from your session?
There are various great benefits to attending an industry conference like the New Generation Operational Risk: Europe conference. Working in a large organization we often forget to look outside and we forget that we have peers we can learn from in the industry. Especially in the area of Technology and when it comes to dealing with regulatory requirements peer approaches interest me the most. At a conference we can engage with other participants casually or formally, we might be introduced to new topics that we have not worked on before through the various experienced speakers. In general I believe that the financial services industry should integrate more and work together closely on solving problems that concern all of us.
In your opinion, how can we look to effectively implement flexible change?
In my opinion there are 3 important factors to flexible change: 1) knowledge retention; 2) implementation efficiency and 3) technical solution flexibility. One of the main mistakes that is often made is that change is seen as a one off instance and not as a constant. We need to build designated long-term change teams with the right skill sets that implement varying changes across the institutions. They need to be efficient in the ways they implement and flexible in the way they work with structures, topics and stakeholders. Most of all, they need to receive the right level of support and standing in the organization to be effective.
What are the key considerations that need to be made when dealing with macro changes on the regulatory environment?
On a macro-level we will need to keep an eye on global initiatives that require more and more local implementation. While intra-national organizations are setting global goals, countries are shying away from unification on various levels. Examples are Brexit and equivalence discussions in Switzerland as opposed to G20 Derivative Reform goals or UN Sustainability goals signed by over 40 nations. Furthermore, we need to account for specification and sophistication when it comes to existing and new regulations. Regulators are getting more specific and more stringent and financial services institutions have to ensure to adjust to the ever changing expectations. As a third topic, we need to be aware of the constant stretch between transparency and privacy towards stakeholders which requires extremely diligent data management.
Please can you provide an overview of the case studies: MiFIDII & Brexit implications in global WM business?
This is a very big question. I’d say the most important question that needs to be considered for any financial services provider is “What markets do we want to serve and how can we be compliant with all relevant regulations in those markets?”. This question is to be revisited for the new environment under Brexit once we know the exact rules to operate under.
Looking ahead, what operational / emerging risk do you think will keep people up at night?
Most industry players are loading their infrastructures up with complex changes on a regular basis. Often times these infrastructures were not created for the emerged ever changing environment or for the growing data demand and the required interconnection between external and internal systems. It is a challenge to balance highly sophisticated add-ons and aged IT systems. It is a massive level of complexity that needs to be managed continuously through all regulatory and market changes.