Compliance Risk refers to the potential for legal or regulatory penalties, financial forfeiture, or reputational damage that an organization may face if it fails to comply with laws, regulations, standards, or internal policies. This risk arises from a variety of sources, including changes in legislation, regulatory scrutiny, and the complexity of compliance requirements across different jurisdictions. Effective management of compliance risk involves establishing robust compliance programs, regular training for employees, conducting audits, and maintaining clear communication channels with regulatory bodies to ensure adherence to all relevant legal obligations.

Basel scope:

• Pillar 2

Capital requirements:

Mitigated by Capital

Related Links:

•       Basel Framework