
42 Operational Risk Control
䊏 Business continuity planning
䊏 Business concentration
䊏 Litigation
䊏 Legislative changes
䊏 Compliance
䊏 Development and use of models
䊏 Insider trading
䊏 Taxation.
In connection with operational risk, major activities in which a financial institution,
and any other organization, finds itself engaged should be examined both in a holistic
form and in detail. An example is outsourcing, which some banks have begun to
practice widely on the wrong assumption that in this way they delegate part of their
responsibilities. This is tantamount to underestimating operational risks. A Basel
Committee document of July 2002 on sound practices ...