Transforming the CFO Role in Financial Institutions: Towards Better Alignment of Risk, Finance and Performance Management

This EIU study examines the current state of finance processes and how these processes could be modified to address the new competitive and regulatory dynamics faced by financial institutions.

 

Key findings:

  • Alignment between the risk and finance functions is now essential to banking.
  • Financial institutions can boost profitability by a better alignment of risk and finance.
  • Alignment between risk and finance begins with good data, but the bigger problems are different perspectives and cultures between the two functions.
  • Attention to risk lowered downside risk for US banks during the 2008-09 global financial crisis.
  • Financial institutions are now better prepared for another crisis like the last one, but may not be as well prepared to deal with new or emerging risks.
  • Financial institutions are investing more in technology to improve their ability to integrate risk information into financial and performance management.
  • A majority of finance functions are not applying risk data beyond compliance and product allocation to areas like analysis and budgeting.



 

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