Resilience first: Be prepared for ‘when’ not ‘whether’

Published by: Dan Thieke, Managing Director, DTCC Nov 2019

When it comes to making today’s interconnected financial ecosystem more resilient, everyone agrees on one thing: It’s not a matter of ‘whether’ critical business services will be disrupted, it’s just a matter of ‘when.’ It is more important than ever to be prepared for cyber-attacks, technology-related incidents and other types of shocks that could have systemic ramifications.

As concerns over physical events are starting to be eclipsed by the threat of wide-scale technology disruptions, the scope of resilience programs has expanded significantly. The ability of these programs to adequately absorb shocks and allow firms to quickly recover from disruptions has become a central point of focus for regulators and practitioners alike. In view of how significantly the market environment has changed over the last few years, maintaining appropriate levels of resilience is a complicated balancing act that needs to incorporate a wide array of trade-offs and competing objectives.

In light of this challenging environment, here at DTCC we are discussing principles and guidelines for promoting financial stability by planning for disruptions, and our vision for enhancing resilience as a way to safeguard critical business services. It’s also important to look at the paradigm shifts faced by the industry and describe how this topic has morphed from an IT-centric concern to a first-order business imperative and a strategic enabler.

DTCC is also leveraging leading-edge design principles as it embarks on a multi-year strategic initiative to build a future-state IT architecture that is resilient by design. The principles and guidelines that support DTCC’s approach to enhancing resilience are being shared with the industry as an invitation to foster an active and robust dialogue on this critical topic that includes all stakeholders.

Developing the vision, however, is only the first step toward enhancing resilience. To successfully implement these concepts, organisations must set up an effective governance structure and an operational model that best suits their needs. DTCC is creating a Business Resilience Center of Excellence to this end. This approach will help facilitate rapid deployment that leverages existing resilience-related activities, while centralising talent and expertise within the company.

Safeguarding the stability of financial markets during times of uncertainty has been a key part of DTCC’s mission for more than 45 years. Today, as we double-down on strengthening our processes to address ever-changing threats, we look forward to collaborating with our partners in the industry on a new vision for enhanced global resilience.