Paul, can you please tell the Risk Insights’ about yourself and your professional experiences?
I have worked in the banking industry for over 30 years. Most of that time has been spent in Risk Management although I was a corporate banking relationship manager in the early part of my career. In Risk Management I came up through the ranks of credit risk, starting as a junior corporate credit risk analyst. Most of my career though has been spent managing credit risks on the trading floor which has also meant specialising in financial institutions credit risk.
I have been the CRO of Mizuho International for a little over 2 years. Previously I held senior Risk Management positions at RBS and before that ABN AMRO where I was for a time their UK CRO.
We look forward to the future of risk management Keynote Panel Discussion that you will be joining at Risk EMEA 2017. How do you believe risk managers should best prepare for further evolution in risk management practices?
I see a couple of fundamental drivers. The first is technology. The rate of change in this area provides both opportunities and threats for both the corporation and for the individual. Secondly there is regulation. Just staying informed about everything is an exercise in itself, doing anything with it for the betterment of the company or society as a whole is another thing altogether. Societal changes would be my third driver. Whether this is at the economic/political level e.g. the rise of protectionism, nationalism etc or generational changes e.g. the differences between Baby Boomers and Millennials it all means there is an increasing level of uncertainty and therefore potential volatility to deal with. Traditional Risk Management practises may not necessarily be up to the job.
What advice could you give FIs to help stay ahead of transformations made in technology?
Stay close to the client and work out what it is they want from the technology. Be nimble in your technology development and infrastructure due to the rates of change. Try to use it as a competitive cost advantage, make sure it doesn’t become the opposite. Ensure IT security remains top of the agenda. The last thing any company wants is a high profile technological glitch/hack.
How do you see the role of the chief risk office changing over the next 6-12 months?
Two major themes from the traditional roles: Cyber security and ‘people related matters’. You could wrap these two themes up into a broader context of spending more time solving for reputational risk issues than the more traditional credit risk or market risk related matters, although these will always remain core competencies of any CRO role.