The Governance of Risk Management
Free GARP FRM Part I lesson in Foundations of Risk Management. 18 min read, ~2,715 words.
Governance failures, not model failures, drove the 2007-09 crisis. CROs reported to the wrong people; risk limits weren't enforced; boards lacked the technical literacy to challenge management. Three lines of defense: business units own risk, an independent risk function challenges, internal audit verifies. Each must be independent of the others...
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What this lesson covers
- Content
- Example 1
- Example 2
- Common Mistakes
- Key Takeaways
- Exam Shortcuts
Learning objectives
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