What does a future-ready financial risk function look like?

About the Author

Ruairi O’Donnellan is the Head of Marketing at Intuition. Intuition is your end-to-end strategic learning partner, helping you identify, design, and deliver the knowledge and skills your teams need to succeed. The perspectives in this article are informed by discussions with Intuition colleagues who work closely with risk teams across global financial institutions, as well as by ongoing delivery of risk capability and problem-solving programs.

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Financial risk management is not a function that most organizations actively question. Its presence is assumed, its importance is rarely disputed, and its frameworks are deeply embedded across financial institutions of all sizes.

What is questioned more quietly, and often only in private conversations, is whether risk functions are operating in a way that genuinely supports how modern financial institutions make decisions.

As organizations become more complex, products move faster, and commercial pressure increases, many risk teams find themselves caught between what they are expected to enable and what they are equipped to do. Strong governance and technical expertise remain essential, but on their own they do not always translate into effective decision support.

This article looks at what a future-ready financial risk function looks like in practice, and how risk capability can be developed deliberately rather than assumed to emerge over time.

Rather than focusing on abstract models or aspirational statements, the emphasis here is on the practical design choices that shape how risk is experienced day-to-day by the business.

Table of contents

• Why risk functions are under increasing pressure
• Designing risk capability with intent
• Understanding where capability gaps actually sit
• Establishing shared foundations
• Applying risk thinking in real situations
• Using scenarios to develop judgment
• Communication, influence, and credibility
• Embedding change across teams
• How effectiveness should be measured
• Closing thoughts

Why risk functions are under pressure

Risk teams today are operating in environments where decisions need to be made quickly, often with incomplete information and competing priorities, while regulatory expectations continue to rise rather than recede.

In many organizations, risk is expected to support innovation, growth, and strategic change, yet is still primarily structured around tools and processes designed to control and constrain. This creates tension, not because risk professionals lack capability, but because the nature of the work has evolved faster than the way risk capability has been developed.

When this mismatch persists, it tends to surface in familiar ways.

Decisions slow down. Escalation becomes the default response. Engagement with the business becomes reactive rather than collaborative.

Over time, trust erodes, and risk is increasingly viewed as something to be managed around rather than engaged with early and proactively.

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The risk management market was valued at $15.40 billion in 2024 and is projected to reach $51.97 billion by 2033, growing at 14.6% CAGR.

Source

Designing risk capability with intent

One of the most common assumptions in risk is that capability develops naturally with experience. While experience is important, it is rarely sufficient on its own.

Risk capability is shaped by what people are taught to pay attention to, how they are expected to approach problems, and what behaviors are reinforced or discouraged over time. If problem-solving, judgment, and communication are not developed explicitly, they tend to remain uneven and inconsistent across teams.

Designing risk capability with intent means acknowledging that technical knowledge is only part of the picture. It requires thinking carefully about how risk professionals are supported to analyze ambiguity, weigh trade-offs, and engage constructively with colleagues outside the function.

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Understanding where capability gaps actually sit

Many organizations believe they understand where their risk capability gaps lie, but those assumptions are often based on role descriptions or seniority rather than evidence.

Structured diagnostics can provide a clearer picture, particularly when they examine how risk professionals approach decision making, problem framing, and communication under pressure. These areas are often where the greatest variation exists, even among highly experienced teams.

Replacing assumption with insight allows development effort to be targeted more effectively, and helps avoid investing time in areas where capability is already strong.

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Establishing shared foundations

Consistency across risk teams matters more than is often acknowledged.

Shared foundations help establish common language and expectations around how risk is assessed, discussed, and applied. This includes clarity around the difference between risk avoidance and risk intelligence, and how risk contributes to business outcomes rather than simply constraining them.

Foundational learning is most effective when it reflects the specific operating context of the institution, rather than relying on generic theory that can feel disconnected from day-to-day decision making.

Applying risk thinking in real situations

Risk capability only becomes meaningful when it is applied in situations that resemble real work.

Practical exercises, case studies, and applied scenarios allow risk professionals to work through decisions that involve ambiguity, competing objectives, and imperfect information. These experiences help shift risk engagement away from abstract evaluation and toward constructive resolution.

Over time, this changes how risk professionals approach their role, and how they are perceived by the business.

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Using scenarios to develop judgment

Judgment is not something that can be taught directly. It develops through exposure, reflection, and repeated decision-making in realistic contexts.

Scenario-based learning provides a way to accelerate this process. By working through complex situations in a facilitated environment, risk professionals can test assumptions, explore alternatives, and understand the consequences of different choices without real-world downside.

This approach helps build confidence and consistency across teams, particularly in how risk is applied under pressure.

Communication, influence, and credibility

Even when analysis is strong, its impact is limited if it is not communicated effectively.

Risk professionals are often required to explain complex issues to audiences with very different priorities and levels of technical understanding. Without support in how to frame and communicate risk insights, conversations can quickly become adversarial or unproductive.

Developing communication and influence skills allows risk professionals to engage more effectively, build credibility, and position themselves as partners in decision making rather than as gatekeepers.

Embedding change across teams

Sustainable change does not come from isolated interventions or individual excellence. It requires reinforcement across teams, regions, and leadership layers.

New ways of thinking need to be embedded into everyday routines, expectations, and conversations. When this happens consistently, the role of risk begins to shift in a tangible way, both internally and in how it is perceived by the business.

How effectiveness should be measured

As risk functions evolve, so too should the way effectiveness is assessed.

Traditional measures often focus on activity rather than impact. Looking instead at decision quality, stakeholder engagement, and reduced friction with the business provides a more meaningful view of whether risk capability is supporting the organization as intended.

These indicators offer insight into whether change is taking hold in practice, not just on paper.

Closing thoughts

The future of financial risk management will not be defined by the introduction of new frameworks or additional layers of control.

It will be shaped by how well risk professionals are equipped to think critically, solve problems, and engage constructively with the business in moments that matter.

Organizations that invest deliberately in these capabilities are better positioned to navigate complexity, support growth, and maintain resilience in environments where certainty is increasingly rare.

Key takeaways and next steps

Key takeaways

• Risk capability rarely develops by chance. It improves when time is taken to think deliberately about how people learn, practice, and apply judgment in real situations.
• Looking at how effective risk is should go beyond counting activity and instead focus on the quality of decisions being supported and the outcomes those decisions produce.
• One-off interventions tend to fade quickly. Lasting change comes from repeated application and reinforcement in the flow of work.
• While individual expertise matters, the overall effectiveness of a risk function depends just as much on consistency across teams and regions.
• As risk roles continue to evolve, judgment and problem-solving are becoming as important as technical knowledge, particularly in complex and ambiguous decision-making environments.

Next steps

• Take a step back and look honestly at how risk is experienced by your business today, including where interactions feel helpful and where they create friction.
• Pinpoint the moments where decisions slow down or escalate unnecessarily, and consider whether gaps in judgment, problem-solving, or communication are contributing to that.
• Focus development efforts on the decisions that actually matter day-to-day, rather than abstract competencies or theoretical scenarios.
• Support new ways of working through leadership behaviors and everyday conversations.
• Pay attention to the outcomes that indicate progress, such as better quality decisions, stronger relationships with the business, and reduced friction over time.

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