The introduction of the Standardized Measurement Approach (SMA) by the Basel Committee in December 2017 marks an inflection point in the evolution of operational risk within financial institutions. This new regulatory framework replaces existing approaches with a single, standardized approach. Despite the criticism leveled against the SMA, its introduction is an opportunity for the industry to redefine the role of the operational risk department as a true risk partner to the rest of the organization, a change from its primary function today of calculating regulatory capital.
Working together, Marsh and Oliver Wyman are uniquely positioned to help clients optimize the linkage between operational risk and insurance. Read more in our latest piece.