Managing Models and their Risks
Models digest input, typically quantitative data, and provide output to forecast what is likely to happen. They give companies the opportunity to reduce risk and operate more efficiently. Such models can consume data and provide output much faster than humans, and with fewer errors. However, they also can introduce considerable operational and even enterprise risk, as faulty outputs can have serious consequences. It is the responsibility of model risk management (MRM) teams to monitor the processes and ensure their accuracy and integrity.
24 September 2020