RCSA (Risk Control Self-Assessment) reports are critical to managing and mitigating risks across the organization but are often challenging to conduct and report on efficiently. The RCSA process requires each business unit to complete self-assessment reports and submit them to risk managers, who then often combine the multiple evaluations to report on overall enterprise risk.

The Challenges of Manual RCSA Processes for Enterprise Risk Management

With a manual process approach, each business unit completed and delivers its RCSA report in the form of a document or a spreadsheet. This leads to several inefficiencies, such as:

  • Inconsistent risk ratings across business units
  • Non-standardized control and risk taxonomy
  • Subjective versus objective evaluations
  • Disorganized approach and duplicate controls
  • Outdated data
It is not possible to automate the risk assessment itself; we need risk managers to evaluate the risk based on different factors and understand its severity. Click To Tweet

Inconsistent risk ratings across business units

Since every business unit evaluates risks and controls as they relate to individual business lines, the same risks may be assessed and rated differently across different business units. This applies to both residual and inherent risks.

Non-standardized control and risk taxonomy

Different business units may be reporting on the same risks and controls using different terminology. This can result in overlap and confusion when the reports are being evaluated and rolled up into an enterprise risk report. The risk manager must subjectively interpret the evaluations or ask for clarification from different business units, resulting in additional effort.

Subjective versus objective evaluations

Risk evaluations are subjective because these are largely handled by each business unit’s manager. Without standardized set of evaluation criteria, business units either independently evaluate assigned risks or collectively decide how to evaluate the risks and controls.

Disorganized approach and duplicate controls

Decentralized RCSA data approaches – sending different segments of spreadsheet and/or Word documents to different business units – leads to disorganized data and additional effort. It can also result in duplication of controls, effort and potential inaccuracies.

Outdated data

By the time the business unit reports are evaluated and rolled up the data is often outdated. Without a real-time data approach for RCSA processes and reporting, risk and compliance stakeholders are only able to evaluate and advise on historic data, rather than emerging risks.

The benefits of RCSA automation for enterprise risk management

Automating the RCSA process workflow can achieve many benefits. It is important to understand what automating RCSA means in this context. It is not possible to automate the risk assessment itself; we need risk managers to evaluate the risk based on different factors and understand its severity. That is the advantage of automating the RCSA process – it gives the risk managers more time to spend and get better results from evaluation. Here are some of the benefits you can expect from using an RCSA solution:

  • Standardized risks taxonomy and ratings
  • Shared control library
  • Automatic collection and collation of reports
  • Task management

Standardized risk taxonomy and ratings

An RCSA solution features a common risk and control taxonomy that can be used by the whole organization. Instead of every business unit defining its own risks and controls, every risk that has been defined goes into a central database. If any other business unit also faces the same risk, they can simply select the risk already present in the database. This means that all the items associated with one risk can be viewed in one place. The risk ratings are also shared between the business units.

Shared control library

RCSA solutions also have a shared library for controls. This allows management to see how each control is performing in different business units and diagnose any process related issues that may be causing inefficiencies.

Automatic collection and collation of reports

The standardization of risk and control taxonomies enables the RCSA solution to easily combine the reports and collate the data and analyze it for enterprise risk management. Since all the same risks and controls are linked, management can easily see how each risk is affecting different business units, how different business units are managing risks, how controls are shared between departments, and many other insights. The RCSA solution also takes the risk ratings across departments and generates risk ratings for the whole enterprise.

Task management

The RCSA solution also delivers tools that allow management to easily mitigate risks. Action items can be assigned to risks and controls right from the RCSA panel, allowing managers to easily and quickly ensure that risks are being mitigated throughout the organization.


360factors Risk Control Self-Assessment (RCSA) Solution

360factors’ RCSA solution is designed to empower banking, financial services and insurance (BFSI) organizations to quickly improve the way of management and mitigates enterprise risks. The Predict360 RCSA solution goes beyond simply eliminating operational challenges in RCSA and adds another layer of Business Intelligence (BI) across operational and enterprise risk management. Powerful analytics and insights capabilities with UI/UX dashboards enable managers to perform analysis and drill down to get root cause which enables businesses to accurately manage risks and ensure that risk information is updated properly.

Are you looking for the ways to improve enterprise risk management within your organization? Get in touch with our risk management experts to see how RCSA solution can help your organization and get more control and visibility over the risks that affect your business.