Caribbean Development Bank, Chief Risk Officer, Enterprise Risk Management, Risk Culture Development, Risk Management Practices
Previous risk culture research has concentrated on the regulated commercial banking and insurance sectors in developed economies. The paucity of studies for developing economies has prompted this research. The objective of this paper is to examine risk culture development and its impact within the Barbados-based Caribbean Development Bank. Given the unregulated nature of development banking, it was anticipated that the risk culture environment within this type of institution would be different to the risk culture environment inherent in regulated entities and will provide a good platform for new findings.
Primary data were collected via an interview with the Chief Risk Officer in August 2015 and a three-month field observation at the Bank. The paper utilizes the KPMG risk culture maturity model in conjunction with an adapted version of the Horst Simon risk culture maturity scale to classify the maturity level of risk culture within the Bank.
An important finding from the research is that accountability, awareness, communication and leadership have become strong indicators of the Caribbean Development Bank’s risk culture and have contributed to increased uniformity in risk management knowledge, improved coordination of risk data collation and better escalation of risk management issues. Thus, there has been enhanced efficiency of risk management practices within the Bank.
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