ECF - Operational Risk Management

Overview

With the aim of supporting capacity building and talent development for banking professionals, the Hong Kong Monetary Authority (HKMA) has been working together with the banking industry to introduce an industry-wide competency framework - “Enhanced Competency Framework (ECF) for Banking Practitioners” in Hong Kong.

The Enhanced Competency Framework on Operational Risk Management (hereinafter referred to as “ECF-ORM”) is a non-statutory framework which sets out the common and core competences required of operational risk management practitioners in the Hong Kong’s banking industry. The objectives of the ECF-ORM are twofold:

(a) to develop a sustainable talent pool of operational risk management practitioners for the banking industry; and

(b) to raise the professional competence of existing operational risk management practitioners in the banking industry

Although the ECF-ORM is not a mandatory licensing regime, AIs are encouraged to adopt it for purposes including but not limited to:

(a) using the ECF-ORM as a benchmark to determine the level of competence required and assess the ongoing competence of relevant employees;

(b) supporting relevant employees to attend training programmes and examinations that meet the ECF-ORM benchmark;

(c) supporting the continuing professional development (CPD) of relevant employees; AND

(d) promoting the ECF-ORM as an industry-recognised qualification, including for recruitment purposes

Please refer to the HKMA Circular on “Enhanced Competency Framework on Operational Risk Management” for details.

Scope of Application

The ECF-ORM is intended to apply to “Relevant Practitioners” (RPs) whose primary responsibilities are performing operational risk governance, operational risk identification and assessment, operational risk monitoring and reporting, operational risk control and mitigation, and business resiliency and continuity planning within an AI. The ECF on ORM is aimed at RPs located in the Hong Kong office of an AI and performing the operational risk management and business control risk and control functions in Hong Kong.

Details of the respective roles are classified by a two-level qualification structure namely Core Level and Professional Level. Please refer to the HKMA’s “Guide to Enhanced Competency Framework on Operational Risk Management” for details on the qualification standards and certification, training programmes and examinations, grandfathering and CPD requirements.

Further details on the training programmes and examinations schedule, grandfathering and certification application arrangement will be provided in due course.