Risk leaders can no longer rely solely on traditional controls to navigate an increasingly fractured world, senior banking executives said, arguing that resilience, customer focus and organizational agility have become essential as geopolitical shocks, te
Senior banking executives urged
financial institutions to rethink the chief risk officer's role, arguing that
resilience, organizational agility and customer-centric risk management are now
more important than attempting to forecast the next geopolitical or economic
shock.
Risk leaders should spend less time
trying to predict the next crisis and more time building organizations capable
of surviving it.
That was the central conclusion from
a panel of senior banking executives, who argued that resilience, agility and
enterprise-wide thinking have become the defining qualities of effective risk
leadership in an increasingly volatile world.
Speaking at CeFPro's latest Risk
Evolve 2026 event, the chief risk officer of a leading European digital bank
said the traditional role of risk management is no longer sufficient for
today's operating environment.
While established frameworks remain
essential for controlling known risks, she argued that institutions must now
focus equally on preparing for unpredictable external shocks.
"Traditional risk management
approaches are great to make sure you control what you know," she said.
"What risk management needs to do is build on that foundation and then try
to think about how do we then deal with the unpredictable, unanticipated,
exogenous shocks."
Joining the discussion were the group
chief risk officer of a major UK specialist lender and the head of customer
compliance at a leading UK retail bank, who agreed that recent years have
fundamentally expanded the chief risk officer's mandate.
Rather than acting primarily as
guardians of governance and compliance, today's risk leaders are increasingly
expected to influence strategic decision-making, strengthen organizational
resilience and help executive teams navigate an almost constant stream of
disruption.
Audience polling identified
geopolitics, artificial intelligence and cybersecurity among the industry's
highest priorities, highlighting how risk leaders are confronting a far broader
range of interconnected threats than ever before.
The panel argued that although the
sources of disruption continue to evolve, the principles of effective risk
management remain remarkably consistent.
The senior compliance executive said
experience teaches risk professionals not to overreact to every emerging
crisis.
"I don't know how many
unprecedented crises I've been through," she said. "The thing you
start to learn is that what's going on around you is different. The causal
events are different. What you have to do as a risk management team remains
fairly similar."
She explained that institutions still
need reliable data, effective controls, sufficient liquidity and strong capital
positions while supporting customers through periods of uncertainty.
Over time, repeated experience builds
the organizational "playbook and muscle memory" that allows firms to
respond more effectively when the next crisis emerges.
The digital bank executive argued
that resilience should now become the organizing principle for enterprise risk
management.
While organizations naturally budget
for expected losses such as fraud, financial crime or credit deterioration, she
said their real challenge is understanding how unexpected geopolitical or
economic shocks eventually affect liquidity, capital, profitability and
customer outcomes.
She described resilience as
consisting of four connected capabilities: anticipating future threats wherever
possible, absorbing shocks when they occur, recovering quickly and adapting
successfully to the new operating environment. Every financial institution, she
argued, should be strengthening those capabilities rather than relying solely
on historical risk models.
