The financial crisis may not be over any time soon, but those in the global banking industry, including Ernst & Young's Banking & Capital Markets Leader Bill Schlich, are already seeing signs of a silver lining amidst the gloom and doom.
"Whether it's outside influences -- government, regulators and consumers -- or internal leadership within global banking institutions -- everyone is realizing the need for improvement around risk governance and business models," Schlich said.
According to Ernst & Young's second annual risk governance survey of banking leaders, three-quarters of all respondents cited the vital importance of creating a risk-aware culture throughout their institutions, involving both top-down oversight and bottom-up involvement from front-line risk takers.
The survey, titled Navigating the crisis, also found that 86% indicated their banks are implementing a variety of projects designed to provide a more comprehensive approach to risk. However, only 16% said they have a well-defined, shared vision of what it would look like. Overcoming organizational silos, decentralization of resources and decision-making, inadequate forecasting, and lack of transparent reporting were cited as major barriers to effective enterprise-wide risk management.
