Basel Committee: Sound Practices for the Management and Supervision of Operational Risk
OM-B.1.4
The paper (see www.bis.org/publ/bcbs96.pdf) issued in February 2003 by the Risk Management Group of the
Basel Committee on Banking Supervision, outlines a set of principles that provide a framework for the effective management and supervision of operational risk, for use by banks and supervisory authorities when evaluating operational risk management policies and practices.OM-B.1.5
The paper also recognises that clear strategies and oversight by the Board of Directors and senior management, a strong operational risk culture and internal control culture (including, among other things, clear lines of responsibility and segregation of duties), effective internal reporting, and contingency planning are all crucial elements of an effective operational risk management framework for banks of any size and scope.
