Rethinking the supervisory approach 2023

Front-office supervision is a complicated undertaking due to a constantly evolving regulatory framework, rapid pace of change in the business, and ongoing evolution of both management and regulatory expectations.

Addressing these challenges can reduce the cost to support the supervisory function and create supervisor bandwidth. Firms should reevaluate their supervision strategy for ways to optimize the framework while balancing cost, efficiency, and supervisory effectiveness.¹

With the return to a new normal, a right-sizing of responsibility is paramount to optimize accountability with respect to supervisory frameworks, including the operational risks and supervisory controls they manage. KPMG LLP is supporting our clients’ reevaluation of the supervisory operating model to empower first line of defense supervisors to effectively manage risk, execute controls, and identify red-flag trends in conduct and behavior of their team(s).

Footnotes

¹ KPMG | Balance cost, efficiency, and effectiveness (January 2023)