ABSTRACT
This chapter examines the science and the art of regulatory risk management by considering the context of the Compliance role. It explores risk in the regulatory environment and addresses how this can most effectively be managed. The chapter focuses on the activities necessary to effectively manage regulatory risk and the roles of the key stakeholders involved. It also addresses the role of risk in regulatory approaches. The regulators of the financial services industry have an important role to play in managing the risks inherent within this industry, whether it be risks with which the industry is familiar or those that are emerging. The Compliance function's role is to be part of the management and control structure set up to do this and, as such, the principle role of the Compliance function is to assist the regulated business in the management of its Compliance risk.
