PART 3
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But market participants have never been in a better place to identify, understand, and mitigate these threats.
Moody’s is bringing together multiple data sets to assess emerging risks and building risk analysis tools across multiple factors.
Meeting the challenge, however, requires both advanced data and technology and, often, organizational behavior change.
Historically, organizations studied and managed risks in silos, defined by the risk area in question or the expertise it required.
The supply chain team managed risks within the supply chain. The office of the CIO managed cyber risk.
As new risks emerged, companies assessed data and analysis to understand those risks. They added in-house expertise to
manage those risks. But the risks still remained siloed, dealt with largely on their own.
Now, as leaders witness or experience the impact of exponential risk, they are breaking down their own internal silos
that can limit the ability to see, understand, and address these threats.
Cross-risk threat analysis and mitigation are now best practice. The focus is less on the individual risk and more on
potential combinations.
The complexity and vastness of RiskN – Exponential Risk means that an unprecedented level of intelligence and insight is required.
That’s now possible thanks to massive third-party data sets built around complex relationships and supply chains,
powerful analytical tools able to unlock deep insights, and a growing body of knowledge drawn from one real-time example after another.
Effective integrated risk analysis defines a common language and framework for a wide variety of risk factors
and their potential financial impact.
It then translates events into probabilities of default and loss, and analyzes how risks interact and compound over time
— and how that affects financial performance from valuation to cash flow and return on investment.
It works at both asset and portfolio level, allowing organizations and nations to understand their exposure and swap out riskier assets.
and build resilience grows, Moody’s is bringing together multiple data sets to assess emerging risks and building risk analysis tools across multiple factors that are both backward- and forward-looking — modeling what could result after an event has occurred and predicting what could result if an event were to occur.
