With risks changing constantly, there is a need for financial market players such as wealth managers to have a convenient overview of all the risks that feed into the businesses they invest in, lend money to, and interact with. We talk to Moody's about its new offering.

With global turbulence making headlines, wealth managers, private bankers and others need a one-stop view of risk more than ever before. Moody’s is tapping that need with the recent launch of its Moody’s Maxsight™ unified risk platform.

The offering is designed to help businesses decode risk and find opportunities across third-party relationships, supply chains, and compliance processes.

The platform gives users a “single pane of glass” through which to understand the risks surrounding a company, Ted Datta, senior director, financial crime industry practice at Moody’s, told Family Wealth Report in a recent call. Datta is based in London.

Datta said the platform is designed to respond to the fact that “conventional, departmental ways of measuring risk have become redundant.” Different “vectors of risk” are brought together into a “single view,” he said. 

“We see a lot of appetite [for Maxsight],” Datta said. For example, the platform can put up red flags about entities such as shell companies, he said. “If you can be agile and see through [risks] it can guide growth.”

Moody's said its screening databases record thousands of risk events and create risk profiles every day. Monitoring these risk factors requires teams to understand hundreds of data points, each potentially needing further assessment or investigation.

For example, based on 2023 annual totals from Moody’s global datasets, 117 entities per day were added to Moody’s global watchlists with links to direct or indirect sanctions; 286 unique risk profiles (i.e. associated with an individual or entity) per day were added to Moody’s screening database with a fraud-related risk code, and 298 unique risk profiles (i.e. associated with an individual or entity) per day were added to Moody’s screening database with an organized crime-related risk code.

A point to consider, however, is that risk factors change constantly. To address this, Moody’s designed Maxsight™.

As Moody’s said at the time of the launch: “Compliance, operational resilience, the potential for reputational harm, and the drive for best practices mean organizations need to be able to identify multiple risks at any one time and actively address issues with some urgency.

“As a result, risk management and mitigation are no longer solely the purview of compliance, KYC, procurement, or senior management. Instead, many teams, departments, and individuals must leverage the same critical risk data to make operational and strategic decisions,” it said. 

Moody’s has been working on the offering for five years, it said.