Give your Board or Audit Committee the comfort they seek in effectively tracking KRIs and KCSAs

To effectively track risk parameters in a company, you must move beyond a simple static list and implement a dynamic, multi-faceted system. Most companies already have well-defined key metrics and a board approved risk framework but fall short of leveraging technology to provide real-time insights.

Manual tracking using spreadsheets is inefficient and prone to error. Dedicated risk management software is essential for effective tracking in most modern companies.

• Centralized Database: A software platform (often called an Integrated Risk Management or GRC solution) provides a single source of truth for all risk data. It consolidates information from various departments, eliminating data duplication.
• Real-Time Dashboards: These platforms offer real-time, customizable dashboards that visualize KRIs, risk trends, and the status of mitigation plans. This provides leadership with a clear, holistic view of the company's risk profile.
• Automated Reporting and Alerts: The software can automate the generation of reports for the Board, management, and regulators. It can also send automatic alerts to risk owners when a KRI crosses a predetermined threshold, enabling a proactive response.

A static Risk management Solution is useless if it doesn’t aid in continuous Monitoring and Communication for risk tracking is not a one-time activity; it's an ongoing cycle.

• Regular Reviews: The designated risk owners and the risk management team should review KRIs and the status of mitigation plans on a regular basis (e.g., weekly or monthly).
• Board-Level Oversight: Technology allows you to segregate various risks and prioritise the ones your Board of Directors or the Audit Committee should review periodically.
• Set Thresholds and Triggers: For each KRI, you should be able to establish a clear threshold (e.g., green, yellow, red). When a KRI crosses into the "yellow" or "red" zone, it should automatically trigger an alert to the risk owner to investigate and take corrective action.

In the end risk management is not the sole responsibility of the Chief Risk Officer but each department head should be held accountable for the risks in her department. The software should therefore have the ability to effectively monitor the risk and ensure mitigation plans are in place and working.