COSO Framework And Risk Governance In Indian Private Banks: Towards Sustainable Banking Practices

Abstract

This paper aims to evaluate the effectiveness of risk management of Indian private banks using COSO’s IC framework components (Control Environment, Risk Assessment, Information & Communication, Control Activities, and Monitoring). The study employed a survey research design and used 490 questionnaires out of 600 distributed to the bank’s managers, internal control managers and internal auditors representing an 81.6 % response rate. The gathered data were examined using R software through EFA and CFA techniques to identify thematic structures, validate constructs, and execute a SEM model. The results of the study gained ascertained that significant and strong control existed in the control environment, control activities, and information & communication activities of internal control of Indian private banks. Monitoring component and Risk assessment activities had a low average mean because private banks operate under higher risk than the public banks. It is propose that Indian private banks should increase investment in risk assessment and monitoring components.