Behavioural Risk is Meta Risk

Last night I woke up at 3am. Jet lag and Szechwan chilli combining to ill effect.

And in the hour before sleep’s welcome re-embrace I had a revelation, as I was thinking about Meta Cognition.

Which (I think) means I was thinking about people thinking about thinking.

Now re-framed as Meta Cognition (MC) squared.

If so, and if we allocate E as representing my Epiphany, then we arrive at E=MC2 - which for some reason resonates.

My insight was this. As with Meta Cognition, so it is with Behavioural Risk being a Meta Behavioural Risk.

It is unique as a risk management challenge, as our own behaviour (and that of regulators, boards and executives) impacts how we consider behaviour.

We are therefore stuck in a recursive loop. 

Blind spots and biases in our understanding of behaviour preventing us recognising blind spots and biases.

Our over-confidence, framing, desire for narrative and fear of messy complexity (AKA reality) militating against a willingness to engage with behaviour.

No wonder that the GFC, conduct catastrophes, and the loss of Banks in 2023 still fails to move the needle.

If we cannot see what we cannot see, because the thing we cannot see impacts our sight.

Then that is our plight.

Am I right?