Efficient control is impossible without appropriate culture. But why IT professionals should care? COBIT’s 5 pay attention to culture. Principle 4 from the framework “Enabling holistic approach” defines culture, ethics and behavior as a key enabler. How much risk to take, how people follow rules, how we react on negative outcomes are typical risk culture issues. Behavior and leading by example (risk culture names it “tone at the top”) are important interaction between governance and management.

1. SVETLOZAR KARANESHEV
1
RISK GOVERNANCE & CULTURE
SVETLOZAR KARANESHEV & STELIANA KEMCHEVA

2. SVETLOZAR KARANESHEV
SVETLOZAR KARANESHEV
Corporate Governance, Risk and Risk Culture,
Information and Data Governance, Big Data,
Data Analytics and Business Intelligence.
Experience: 25 years in the area of risk and finance.
As a Head of Audit he assesses the risks of the organization, audits the
corporate and risk governance; strategic, control and operational
management systems and function; critical business and operational
processes and functions. His achievements before are in the areas of risk
management; mergers, acquisitions and post-merger integration; business
development; organization development, restructuring and turnaround;
investment portfolio management; design and implementation of
management and control systems; business process design and
reengineering.
Co-Founder of the Risk Culture Lab – aimed to
connect experts to build knowledge on the role of Culture and Risk Culture
in organizations and society and to experiment and explore Culture and Risk
Culture in the context of today's reality
svetlozar.karaneshev@gmail.com

3. SVETLOZAR KARANESHEV
STELIANA KEMCHEVA
Culture & Team Dynamics Consultant at
Eudaimonia Solutions – Co-founder of
Risk Culture Lab
I am passionate about designing and hosting
participatory group processes which ignite team’s
capacity to co-create and communicate while capitalizing
on the different personalities people have.
My approach follows the dance between structure and
chaos, planned and emerging, knowing and sensing,
intellect and emotions in a dynamic ever-changing
environment.
I believe that collaboration and having a shared vision are
key factors for building strong organizational culture
which inspires and provokes commitment.
steliana@eudaimonia.solutions

4. SVETLOZAR KARANESHEV
THE ORGANIZATION IS...
?

5. SVETLOZAR KARANESHEV
THE CONTROL SYSTEM IS...

6. SVETLOZAR KARANESHEV
https://www.e92plus.com/docs/default-source/pdf/whitepapers/forcepoint_2016_global_threat_report_en_0.pdf

7. SVETLOZAR KARANESHEV
COBIT 5 FOCUSES ON RISK CULTURE

8. SVETLOZAR KARANESHEV
PRINCIPLE 4: ENABLING A HOLISTIC APPROACH

9. SVETLOZAR KARANESHEV
PRINCIPLE 4: ENABLING A HOLISTIC APPROACH

10. SVETLOZAR KARANESHEV
PRINCIPLE 5: SEPARATING GOVERNANCE FROM
MANAGEMENT

11. SVETLOZAR KARANESHEV
PRINCIPLE 5: SEPARATING GOVERNANCE FROM
MANAGEMENT

12. SVETLOZAR KARANESHEV
RISK GOVERNANCE
• As part of the overall corporate
governance framework, the framework
through which the board and
management establish and make
decisions about the bank’s strategy and
risk approach; articulate and monitor
adherence to risk appetite and risk
limits vis-à-vis the bank’s strategy; and
identify, measure, manage and control
• Risks. Risk culture is important element
of risk governance.
• (BCBS corporate governance principles
for banks, July 2015)
• Http://www.Bis.Org/bcbs/publ/d328.Htm

13. SVETLOZAR KARANESHEV
WHY IS RISK CULTURE SO IMPORTANT?
• All organisations need to take risks
to achieve their objectives. The
prevailing risk culture within an
organisation can make it
significantly better or worse at
managing these risks. Risk culture
significantly affects the capability to
take strategic risk decisions and
deliver on performance promises.
Risk culture
Under the Microscope
Guidance for Boards
https://www.theirm.org/media/885907/Risk_C
ulture_A5_WEB15_Oct_2012.pdf

14. SVETLOZAR KARANESHEV
WHAT IS RISK CULTURE?
Risk Culture are the values,
beliefs, knowledge, attitudes,
level of awareness, and the
perceptions of risk shared by a
group of people with a
common goal.
It determines their collective
ability to identify, discuss and
react to the organization's
current and future risks.

15. SVETLOZAR KARANESHEV
GUIDANCE ON SUPERVISORY INTERACTION WITH
FINANCIAL INSTITUTIONS ON RISK CULTURE
• TONE FROM THE TOP: The board and senior management are
the starting point for setting the financial institution’s core values and
expectations for the risk culture of the institution, and their behaviour must
reflect the values being espoused.
• ACCOUNTABILITY: Relevant employees at all levels understand the
core values of the institution and its approach to risk, are capable of performing
their prescribed roles, and are aware that they are held accountable for their
actions in relation to the institution’srisk-taking behaviour. Staff acceptance of
risk-related goals and related values is essential.
• EFFECTIVE COMMUNICATION & CHALLENGE:
A sound risk culture promotes an environment of open communication and
effective challenge in which decision-making processes encourage a range of
views; allow for testing of current practices; stimulate a positive, critical
attitude among employees; and promote an environment of open and
constructive engagement.
• INCENTIVES: Performance and talent management encourage and
reinforce maintenance of the financial institution’s desired risk management
behaviour. Financial and nonfinancial incentives support the core values and
risk culture at all levels of the institution.

16. SVETLOZAR KARANESHEV
https://www.iia.nl/SiteFiles/Hot%20Topics%202018%2011_9_2017_digital%20version.pdf

17. SVETLOZAR KARANESHEV
RISK CULTURE MODELS
All models are
wrong but some
are useful.
GEORGE BOX

18. SVETLOZAR KARANESHEV
RISK CULTURE MODELS

19. SVETLOZAR KARANESHEV
IS CULTURE REALLY THAT IMPORTANT?
“Culture eats
strategy for breakfast,
technology for lunch and
everything else for dinner.“
– Bill Aulent, MIT Sloan School of
Management.

20. SVETLOZAR KARANESHEV
IS CULTURE REALLY IMPORTANT TODAY
COMPARED TO ALL WE NEED TO THINK OF?
“Modern humans have
radically changed the way
that they work and the way
that they live. Companies
need to change the way they
manage and lead to match
the way that modern humans
actually work and live.“
– Brian Halligan, CEO, Hubspot

21. SVETLOZAR KARANESHEV
DOESN’T CULTURE HAPPEN ON ITS OWN?
“All great organization have a
great culture and that happens
neither by chance, nor
overnight. For that to happen,
culture needs to be
MEASURED to be observable
and then MANAGED.”
– Natalia Blagoeva, Founder & Director of Eudaimonia Solutions (Zurich –
Sofia) and Co-Founder of Unleash Leadership (London – Berlin – Zurich)

22. SVETLOZAR KARANESHEV
THE WHOLE-SYSTEM CULTURE NAVIGATOR©
WHAT IS IT?
A whole-system approach to
measuring the culture of an
organization so that all its
elements are visible and can
then be understood and
managed over the short,
medium and long-term.
W E G E T TO T H E C O R E

23. SVETLOZAR KARANESHEV
THE WHOLE-SYSTEM CULTURE NAVIGATOR©
W E G E T TO T H E C O R E
The tool builds upon and uses at its
core the state-of-the-art
methodology of the Barrett Values
Centre and its flagship methodologies
provoking and fostering Leadership
Development and Culture
Transformation. In addition, it
incorporates our own experience as
well as other leading methodologies
of our times.
It helps you identify WHAT
WORKS and WHAT DOESN’T
in your current organizational
culture and most importantly
– WHAT CAN BE DONE to
make it work best, boost
performance and engagement
and support your strategy.

24. SVETLOZAR KARANESHEV
INDIVIDUAL
LEVEL OF COMPETENCE
BEHAVIORS
PERFORMANCE
COLLECTIVE
STRUCTURES & SYSTEMS
PRODUCT, EQUIPMENT, ETC.
BOTTOM LINE RESULTS
WHY A WHOLE-SYSTEM APPROACH?
Source: K. Wilber
LEADERSHIP
CO-WORKERSHIP
PERSONAL MATURITY
SHARED VALUES
LIMITING BELIEFS
SHARED STRATEGIC VISION
Recognizes the need for actions in all four dimensions at the same time.

25. SVETLOZAR KARANESHEV
WHY A WHOLE-SYSTEM APPROACH?
Culture is not about putting make up and playing roles.
To make it really work for you, you need to get to the core:
(1) PEOPLE HAVE PHYSICAL, EMOTIONAL, MENTAL, SPIRITUAL NEEDS,
which impact how they perform, collaborate and contribute.
(2) ORGANIZATIONS ARE LIVING SYSTEMS- complex and unpredictable,
but also able to survive, adapt, evolve and thrive.
(3) THERE ARE SYMPTOMS AND PATTERNS that navigate to what works
and what doesn’t and how to make things better.
W E G E T TO T H E C O R E

26. SVETLOZAR KARANESHEV
PHYSICAL
CONDITIONS
Workplace Quality
Physical Renewal
Healthy Balance
FINANCIAL
STABILITY
Finance Savvy
Balance of Short
and Long-Term
Focus
RELATIONSHIPS
Emotional Maturity
Quality of
Relationships
Reasons for Cultural
Entropy®
COMMUNICATION
Communication
Quality of
Questions &
Listening
WSCN© SCOPE (1 of 4)

27. SVETLOZAR KARANESHEV
STRUCTURE &
MANAGEMENT
Roles, Structure,
Symbols | Profit,
Growth |Manag.
Style | Stake-
holders Focus
MEASUREMENT
& AWARDS
Type of KPIs |
Formal & informal
awards, benefits &
recognitions.
ORGANIZATIONAL
LEARNING
EQ SQ, Int.Q, CQ,
Coll.Q, Blinds Spots,
Mental Models,
Self-Mastery,
Systems Thinking
INNOVATION &
DIVERSITY
Diversity, Creativity
&, Innovation,
Tolerance for
Mistakes, Bottom-
Up &Top-Down
Initiatives
WSCN© SCOPE (2 of 4)

28. SVETLOZAR KARANESHEV
DECISION-
MAKING
Capacity | Fear-
based vs.
Opportunity-based|
Seniority and Rules
vs. Rightness
AUTHENTICITY
& WHOLENESS
Unique Authentic
Integrated Cohesive
Culture vs. Strategy
FULL-SPECTRUM
LEADERSHIP
Self-Leadership &
Personal Entropy,
Full-spectrum
Leadership
OPENNESS TO
OPPORTUNITIES
Mistrust vs. Trust |
Scarcity vs.
Abundance | Self
vs. Others | Blame
vs. Systems view|
Stress vs. Balance
WSCN© SCOPE (3 of 4)

29. SVETLOZAR KARANESHEV
SUSTAINABILITY
& SOCIAL RESP.
Adequacy | Making a
Difference & Social
Impact | Resilience |
Stakeholders
MISSION,VISION
INTEGRATION
Formulation,
Updating, Level of
their Integration
FULL-SPECTRUM
ORGANIZATION
CVA, Value spread,
Cultural Entropy®
and related KPIs
WSCN© SCOPE (4 of 4)

30. SVETLOZAR KARANESHEV
CULTURE REQUIRES LIFE-LONG FOCUS

31. SVETLOZAR KARANESHEV
WSCN© PROCESS
ASSESSMENT
DEFINITION OF A
TRANSFORM. PROGRAM &
COACHING
WSCN©
ASSESSMENT
ANALYSIS
AND REPORT
ADDITIONAL
INTERVIEWS
INTERVIEWS
WORKSHOP
DESKTOP
REVIEWS,
RESEARCH
& SETUP
DESIGN OF THE
TRANSFORM.
PROGRAM
WORKSHOPS
COACHING OF
TRANSFORM.
CHAMPIONS
SETTING PURPOSE,
STRATEGIC GOALS,
ASSESSING RISKS
W E G E T TO T H E C O R E

32. SVETLOZAR KARANESHEV
FUTURE-FIT
CONSCIOUS
CHOICE OF
DIRECTION
SUSTAINABLE
RESULTS
ENGAGEMENT
PERFORMANCE
STRATEGY-FIT
WSCN© ADVANTAGES
W E G E T TO T H E C O R E

33. SVETLOZAR KARANESHEV
IS IT TOO EARLY OR TOO LATE
TO TALK ABOUT RISK CULTURE?
SOFIA | 15.11.2017 | WELCOME
http://bg.eudaimonia.solutions/risk-culture-lab/

34. SVETLOZAR KARANESHEV
THANK YOU!
We would love
to hear from you!
STELIANA
KEMCHEVA
stealiana@eudaimonia.solutions
SVETOSLAV
KARANESHEV
svetlozar.karaneshev@gmail.com