Moore Stephens Consulting has warned the industry that its senior management must accept overall responsibility for
their firms' ability to comply with risk management and other regulatory requirements, or else risk the consequences.
In the latest issue of its Insured Interest newsletter, Moore Stephens said: "The essence of good risk management is to evaluate threats to the business and implement controls to manage the probabilities and consequences to an
acceptable level.
"And risk management has a dual function. Firstly, it may
be used to demonstrate regulatory compliance, which, for the insurance industry, could have particular relevance in terms of demonstrating capital adequacy, for example, or corporate governance compliance, or broker regulation.
"Secondly, risk management should be seen as a means to help
achieve strategic objectives.
Moore Stephens partner Simon Gallagher said: "Our approach is to work closely with clients at the planning and implementation stages...to build a risk management framework in line with the targets and risk appetite established by the board of directors.
"Once the framework is established, the software solution is developed, and management and other users of the system are trained in its operation and maintenance."
