With the recent turmoil in the financial markets risk management has become even more a hot topic. To implement sound investment risk management in wealth management, it is imperative to have an understanding what the outcome of risk management should be, who should be the beneficiary, and how it should be implemented. Our risk management maturity review solutions allows you to gain a holistic view of the maturity of your risk management approach and derive prioritized initiatives that will have a lasting impact on the success of your organization.
Investment risk management is one of the core capabilities of any successful wealth manager. Only through sound risk management can the skills to forecast financial markets be transferred into investment performance. Actively taking risks is the foundation of generating positive excess return in a portfolio. This also means that portfolios need to be constructed in such a way that the impact of any loss stemming from a risk materializing is within the expected boundaries. Unintended risks needs to be avoided, mitigated, or transferred, as there is no need to take a given risk if there is no reward expected.
The actual definition of risk depends on the specific investment solution. It is tightly related to the underlying investment philosophy and should be managed as such. Therefore any risk management framework needs to be tailored to the specific investment solutions.
Based on this review, we jointly define your target risk management maturity (green) state such that it supports your unique investment philosophy. Through prioritized initiatives transforming your organization’s risk management capabilities, we increase the value added by risk management to your investment solutions, your clients, and at the end your organization. Our collaborative approach assures early buy in and know-how transfer ensuring that the changes developed in this engagement can be successfully implemented and will have a lasting impact on the success of your organization.
- We start by analyzing the characteristics of your current risk management approach and determine its maturity. We rely on a standardized set of questions combined with customized interviews.
- We then compare your risk management maturity level to that of your competitors.
- We jointly define your target or desired risk management maturity state.
- Finally, we derive an opportunity landscape and develop a prioritized roadmap transforming your current capabilities to achieve the targeted maturity level.
The benefits of our risk management maturity review for you are twofold:
- First, we offer you a holistic review of your current risk management approach and compare it to those of competitors and best practice
- Second, based on your target risk management maturity level, we jointly develop and prioritize initiatives that will increase the value added by risk management for your investment solutions, your clients, and at the end your organization
In addition, our collaborative approach assures early buy in and know-how transfer ensuring that the changes developed in this engagement can be successfully implemented and will have a lasting impact on the success of your organization.