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Mitigating Compliance Risk with Actionable Data: How This Fortune 100 Financial Firm Found Success

Discover how a Fortune 100 financial company transformed its risk management with FiscalNote Risk Connector. Unveil the secrets to proactive decision-making and regulatory compliance.

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In the bustling realm of finance, navigating the complex web of risks has become an essential art. For a Fortune 100 company in the financial industry, this task took on even greater significance as it faced mounting regulatory demands and the need to assess operational risks accurately.

The Need: A Race Against Time

The clock was ticking, and the company found itself at the epicenter of a storm. Regulatory pressures required it to collect auditable data on operational risks. This, as the data would be critical in calculating the all-important Value at Risk (VaR) and minimum capital requirements.

Amid this challenging landscape, the company had to categorize the data according to the Basel II risk taxonomy. Failure to comply could have dire consequences, impacting the company's reputation and bottom line.

The Challenges: The Maze of External Data

As the company scoured through internal risk data, it soon realized that the bigger challenge lay outside its immediate sphere. Capturing and maintaining data on external operational risks presented an intricate puzzle. The ever-changing nature of the global economy made it increasingly difficult to keep up with potential risks emanating from multiple sources.

To make matters worse, mounting scrutiny following recent bank collapses meant that the company needed a detailed audit trail. It had to showcase its work and the intricate calculations used to determine VaR and follow-on requirements. Without a comprehensive and transparent record, its risk management practices would remain under the microscope.

The Solution: AI-Powered Data Ingestion

Amid this challenging situation, the company forged a strategic partnership with FiscalNote, leading to the creation of an AI-enabled solution tailored to its unique challenges. This tool harnessed the power of algorithmic scanning of open-source intelligence to gather articles and news on operational risk events across the industry.

Each risk event was meticulously tagged with Basel II-compliant metadata. Impact metrics, significance scores, and a structured format were employed to streamline data ingestion.

Surface Potential Issues with Ample Notice

FiscalNote Risk Connector proved to be a game-changer. Not content with merely identifying third-party risks, it went above and beyond to unearth all connections and discussions that could impact the Fortune 100 company. Even without formal SEC filings, it provided a comprehensive picture of potential risks stemming from subsidiaries, customers, tangentially connected suppliers, and partnerships.

The Results: A Triumph in Risk Management

With the power of FiscalNote Risk Connector in its arsenal, the Fortune 100 company witnessed a transformative shift in its risk management approach:

  1. Benchmarking against competitors: Internal operational risk events were benchmarked against those affecting competitors, enabling a comprehensive assessment of potential losses.

  2. Scenario generation: Risk analysts now have the ability to conduct scenario generation. Armed with metadata, they can understand VaR impacts and when they would occur.

  3. Analyzing control failures: The company benchmarked its risk management practices against other institutions, identifying areas for process improvement.

  4. Identifying trends: With a proactive approach to tracking emerging operational risk trends, the company could align its suite of products accordingly.

  5. Prioritizing analysis: Leveraging Risk Connector's impact feed, the company swiftly prioritized high-relevance operational risk events, ensuring a swift response.

Leveling Up Risk Management With FiscalNote Risk Connector

Unlike any other tool, Risk Connector fully maps relationships and detects risks in near real time, leveraging powerful AI to provide the richest and most comprehensive risk data available.

By embracing actionable intelligence with FiscalNote Risk Connector, this Fortune 100 company in the financial industry fortified its risk management approach, making informed decisions and mitigating potential threats proactively.

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