The Central Bank has been adjudged the Risk Manager of the Year by the Central Banking Publications (CBP), in recognition of the strong risk management culture that it has built into its business operations and protecting itself from emerging threats.
The CPB’s editorial team and Advisory Board judge the awards, which are in several categories.
Explaining why the Bank has made a major transition, the CPB said, “The Bank set out on a journey to evolve its risk management practices to meet the requirements of rapidly changing conditions back in March 2011.”
“The aim was not only to raise internal standards of risk management but also to protect the central bank from emerging risks such as information security and fraud”.
Commenting further on the strides the Bank has made in the area of risk management, the award committee mentioned that “like many central banks, particularly in emerging markets, risk at the Bank historically was managed on an ad hoc basis in departmental silos with little central co-ordination.
“That has now changed, through efforts to create a multi-function risk department, and this has won praise from external auditors and is being emulated as a model for other central banks in the sub-region”.
“Among the risk department’s most significant achievements over the past two years has been to work with operational areas to develop a series of risk registers that spans 26 separate departments across the central bank and allows individual business functions to identify the biggest risks they face, as prescribed in the ERM policy.
“Significant risks are then mapped to a central risk dashboard, which is monitored by the risk department and is regularly reported to senior management and the board”.
This has led to a transformation in risk culture.
“The Bank’s risk function, although less sophisticated than those of some of the G20 central banks, has been a trailblazer in sub-Saharan Africa”, CPB noted.
It also pointed out that the Gambian and Sierra Leonean central banks, in particular, have both used the Bank’s ERM framework as a model in building their own risk functions.
Commenting, Ms. Gloria Quartey, the head of the Risk Management Department said:
“Risks were previously managed by various departments in an uncoordinated and silo-based fashion…however, with the establishment of the risk department, risk management moved to a defined level, where risk policies have been more clearly defined and articulated.”
“We are very proud that colleagues in other African countries are coming to learn from us and improve their own risk management processes. We are still a fairly young and lean department but have built capacity over the past year to allow us to quickly identify risks and put workable mitigates in place to address them,” Ms. Quartey said.
The Bank’s framework was developed with reference to the International Organization for Standardization’s ISO 3100 risk management principles and has proved particularly beneficial in managing recent volatility in the Ghanaian cedi.
Bank of England was adjudged the Central Bank of the Year, 2017.