Operational Risk

From Open Risk Manual

Definition

Operational Risk means the risk of loss resulting from inadequate or failed internal processes, people and systems or from external events, and includes legal risk[1]

The name originates from the fact that this risk category concerns threats to the normal operations of the firm or organization.

Decomposition

Given the wide range of business models, operational risk is a very broad category. It is customary to decompose operational risk using a Risk Taxonomy

References

  1. Directive 2006/48/EC Of the European Parliament and of the Council

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