Terms of reference


Purpose of Group

The Operational Risk Standing Group (ORSG) is a pre-consultation forum for discussing:

  • operational risk policy issues arising from the revised Basel Accord (Basel) and the Capital Requirements Directive (CRD);
  • issues regarding the practical implementation and monitoring of compliance with operational risk policy in BIPRU; and
  • domestic operational risk issues not covered by Basel or the CRD.

The ORSG will be the means by which we:

  • discuss our approach to and process for developing guidance on the CRD for operational risk;
  • collaborate with firms to address issues of policy implementation and the monitoring of compliance with operational risk policy in the CRD.

Remit

The ORSG will be responsible for the following topics.

  • The basic indicator approach to operational risk.
  • The standardised approach to operational risk.
  • The advanced measurement approach to operational risk.
  • Operational risk in the SYSC sourcebook.

Responsibilities

We will:

  • ensure that issues raised by firms are given proper consideration, are discussed at the appropriate level within our organisation and that appropriate action is taken to address them;
  • share our policy proposals and rationale with the ORSG members;
  • highlight and discuss implementation issues;
  • ensure that firms' views on policy options are factored into our ongoing negotiation on operational risk in Basel and the EU;
  • circulate minutes from the meeting, comprising action items for us and ORSG members;
  • publish the final version of the ORSG minutes on our website;
  • supply ORSG members with a meeting agenda;
  • provide policy papers explaining the CRD policy issues that we are seeking to resolve and the proposed solutions to them.

The ORSG members are responsible for providing views on the appropriateness and practicality of our proposed solutions to policy issues.

Meeting frequency

ORSG meetings will be held every quarter. Additional meetings may be held when necessary.

Circulation of ORSG papers

ORSG members are free to circulate papers within their organisations and around trade association members in order to gauge industry views.