Written by Anthony Demangone
I like being "on time." I like other people who like to be on time. It shocks me that tardiness is not one of the seven deadly sins.
I think that could be an oversight.
But how do I manage the risk of being late? Before I can even begin to manage this, I need to measure my appetite for being on time.
- Business meetings: I am very risk adverse, bordering on zero-tolerance.
- Social meetings: I am less risk adverse for parties. More risk adverse when meeting people for dinner at a restaurant.
I'll set two alarms the night before a big morning meeting at work. But I won't crack the whip getting Kate and Briggs out the door for a birthday party. (The benefit of being on time doesn't outweigh having a calm day without arguments.)
And in any event, I'd never put anyone's safety at risk (driving dangerously fast) to be on time, even for a work event.
This simple exercise of risk tolerance is sometimes referred to as establishing your risk appetite. It is an essential, yet often overlooked, part of risk management.
How much risk are you willing to "swallow." And in what circumstances? Until you answer those questions, you'll never put in the right risk controls.
As you look at the "seven deadly" risks below, as yourself this question: Do I know my credit union's risk appetite for each?
- Interest rate
If you answer "no," you are not alone. So, here's another question.
Who is in charge of finding out those appetites at your credit union?
Speaking of risk, more than 250 compliance and audit ninjas are gathering in San Antonio this week to help their credit unions manage compliance risk. Yes, it's NAFCU's annual Regulatory Compliance Seminar. I'll be there to join in on all the fun.
And speaking of managing compliance risk, NAFCU has turbo-charged its Webcast and Online Training Center content. In 2016, NAFCU will launch 10 Webcast Series. You'll see series for each of the following areas:
- Data Security
- Loss Prevention
- Risk Management
There's something for everyone here. And if you purchase the Webcast and Online Training Subscription, you can get them all at a much lower price. Go here for more details.