Volatility management: A CRO’s take on the risk landscape and the future of risk teams

What risks keep Gehad El Bendary, Group Chief Risk Officer at Kuwait Finance House, awake at night?

When almost all financial institutions think of growth amidst a volatile economic environment, risk management frameworks that protect performance, sustainability and profitability come into focus. For example, businesses need to understand market volatility’s impact on balance sheet items, but anticipating and understanding market shifts is difficult.

Overcoming these immediate challenges, Gehad notes that the risk function is evolving. Going from a traditional second line of defence role into a strategic integrator, risk teams now provide insight and foresight that inform board and management decisions. With this transformation in mind, future CROs need to be more aware of change, business priorities, turbulent times ahead.

Watch the interview to find out how risk leadership is adapting.

The importance of balancing growth and risk

Balancing growth while managing risks in an ecosystem naturally prone to volatility is challenging but vital. The fundamental difficulty lies in supporting the bank's expansion while operating within the defined risk management frameworks and limits. By acknowledging these dynamics, banks can effectively defend their profitability amidst fluctuating environments.

Navigating market volatility

Anticipation of market volatility impact and responding to them are the main challenges for risk managers. The unpredictable nature of market volatility places it at the forefront of critical risks. Risk managers and businesses need to understand how shifts in volatility affect balance sheet items to maintain a favourable stance for the bank. Proactively responding to varying market conditions is key to sustaining profitability.

The future of risk management: Integration and evolution

Risk management has traditionally acted as a second line of defence. However, the paradigm is shifting. Nowadays, risk management is increasingly integrated into strategic decision-making from the outset. This evolution positions it as a vital component in crafting strategies, ensuring risk considerations are embedded into every decision. As a first line of defence, it provides the insights necessary for boards and management to steer the bank wisely.

Essential skills for future CROs

Diversifying skills and letting go of perfectionism are paramount in addressing uncontrollable market elements. Technical proficiency in understanding shifts and changes is essential. CROs then must prioritise and recognise what truly matters and maintain composure amid constant turbulence.

Learn about the latest trends in risk management practices from leading practitioners and experts at RiskMinds International. Save the date – 16-19 November 2026, London!