Collaboration to support implementation and embedment of evolving operational risk management practices

Abstract

Despite there being a vast array of literature available on operational risk management, literature on industry collaboration and communication to support the implementation and embedment of operational risk management practices is negligible. The banking industry s activities and risk profiles are becoming more diverse and complex due to deregulation and globalisation and banks therefore need to manage the change by continually evaluating their operational risk management practices to ensure that it remains relevant and aligned to evolving practices. This can be achieved through industry collaboration. Purpose The purpose of this research is to determine whether collaboration and communication within the South African banking industry can support the implementation and embedment of evolving operational risk management practices which include the Sound Practices principles. Method Exploratory research using quantitative techniques, a questionnaire, to collect data from a sample consisting of sixteen banks and analsyed using computer-aided quantitative data analysis software (CAQDAS); IBM SPSS Statistics version 23. The sample size was small and not sufficient to perform any statistical analysis but instead SPSS s descriptive statistics tool was used to determine frequency. Finding The literature reviewed and the quantitative study findings provided adequate evidence and answers to the four research questions confirming that collaboration can support the implementation and embedment of evolving operational risk management practices.