As banks face an expanding array of threats and challenges, boards recognize the need to adapt their thinking. As a result, boards are increasingly taking a new approach to operational resilience.
The topic of operational resilience calls to mind internal planning efforts to address a list of everything that could go wrong: next-generation cyberattacks and data breaches, fraud, natural disasters and the economic shocks of inflation and interest rate changes. These critical issues all require careful board oversight of risk mitigation strategies.
But what about external, customer-driven disruptions? Customers now expect seamless digital banking services and omnichannel experiences. New fintech competitors are capable of providing these amenities and are grabbing market share from traditional banks. Many traditional banks aren’t keeping up. An eye-opening 95% of bank executives “believe their current outdated legacy systems and technological capabilities are unable to fully optimize their data for customer-centric growth strategies,” according to the World Retail Banking Report 2022.
These are existential challenges and they demand the same level of attention from the board as, say, cybersecurity. Bank boards should ask themselves: How can we remain relevant in this rapidly changing landscape?