Chris Magno, Head of Enterprise Risk Management at ADP and a lecturer in the M.S. in Enterprise Risk Management program, cautioned his fellow risk and compliance professionals in a recent article on the insidious effects of bias.
Entitled “The Curious Case of Bias in Risk Assessments” and co-authored with Terrance McCue and Michael Gordon, Magno’s article offers timely guidance as organizations conduct their annual year-end compliance and risk assessment process: no matter how many teams of lawyers, accounts, and analysts are dedicated to the task, “there lurks a silent and surreptitious assassin within each response...that variable otherwise known as ‘bias.’”
Attributing the concept to a 1974 article in Science, Magno and his co-authors define “cognitive bias” as “a systematic error in thought that impacts all decisions an individual makes.” They go on to enumerate four ways that risk and compliance professionals can mitigate the inherent biases that exist within both those conducting assessments and those providing responses, from balancing the sample of respondents to outmaneuvering groupthink.
Read the full article and learn more about the M.S. in Enterprise Risk Management program.