Wells Fargo & Co (WFC) Operational Risk Management - 825 Words

Wells Fargo & Co (WFC) Operational Risk Management (Research Paper Sample) Content: Wells Fargo Co (WFC) Operational Risk ManagementNameInstitutionWells Fargo Co (WFC) Operational Risk ManagementWFC is a bank holding firm that offers various financial services in three operating divisions such as whole sale banking, investment and wealth managed, and community banking. The services are offered under three categories including commercial, personal, and small business. The banking segment delivers various financial services such as withdrawals, deposits, and lending while the whole sale segment delivers a financial solution to enterprises within the US and internationally (Colvin, 2017). Finally, the investment and wealth management department gives a various range of individual wealth management as well as retirement and investment services and products to individuals globally. Recently, the company has experienced several risk management challenges, which have caused a decline in its revenue and profitability. This work discusses the problems of a company and provides the solutions that can be adopted by the firm.The first challenge that was experienced by the WFC was the failure of its board of directors to act despite receiving warnings on suspicious activities within the firm. The suspicious activities were related to employees misconduct and ethics as well as declining loan sales (Colvin, 2017). There were no proper audit procedures conducted on loan sales and the worker's compensation policies. The compensation policies had not been reviewed to remove any loophole in the system. Therefore, company workers utilized such loopholes for personal interest. The given challenge could be solved by enforcing a proper audit department to investigate the firm operations. However, the integrity of the board was questionable. Hence, WFC should have reviewed its executive staff, dismiss those who are incompetent and employ only individuals who have the knowledge, experience, and integrity to run the company.Another problem is that the board failed to address the general sluggishness among the workers within the firm. The responsibility of the board is to assess the companys and the CEOs performance. It should ensure that workers are protected from any form of unfair treatment, customers do not suffer any harm, personnel who are dishonest are fired, and the risk profile is maintained as low as possible (Wells Fargo Company SWOT Analysis, 2017). The solution to the problem is to conduct frequent and relevant discussions on the general sluggishness of the board to identify the issues in time. The members should also be engaged in the process by providing the materials, which they can read to understand the organization better. It will as well as allow them to ask questions. Moreover, the board failed to pay attention to whistle blowers who raised warnings on inappropriate acts within the firm. A solution will be to consider every piece of information that they are given and address them appropriately so that they never happen again.What is more, the board failed to understand the needs of various stakeholders including the customers, shareholders, employees, and community. The board used adverse strategies to handle the company problems including firing the staff members and not reimbursing the parties affected. The best strategy to handle the issues is to understand concerns of every party to create a better relationship between the firm and its stakeholders. Retaliation is not the best approach. Every member should be held responsible for their actions to ensure there is an environment of open culture.The company also did set unattainable goals for its workers. Therefore, pressuring workers to employ adverse measures to meet the set targets. For example, WFC employees were forced to open fake accounts and sell unneeded products to customers to meet the set sales target (Mont, 2017). If customers are not given the service that they need, they will move to other rival firms that offer qualit y services to them since they will no longer have confidence in the companys products. The best approach to solve the challenge is for the top executives to consult each other and set appropriate and achievable objectives for ...