Countdown to Solvency II: Meeting the people test
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Instilling risk awareness into the culture and decision making of your organisation. How can you make sure your people pass the test?
As Thomas Steffen (former Chairman of CEIOPS) said "Solvency II is not just about capital. It is a change in behaviour." This change in behaviour will be a critical element of meeting the use test - after all, models don't make decisions, people do.
Every insurer implementing Solvency II will need a people work stream looking at how to make risk management a more prominent feature of reward, training, performance management and governance structures.
However, any changes will be only skin deep and unlikely to convince supervisors without an underlying culture that promotes the necessary risk awareness.
This article explores the key features of an effective risk culture, how this culture manifests itself and how it can be instilled into the organisation.
