An industrial conglomerate spanning five distinct business units had each built its own ad-hoc approach to AI governance — or none at all — leaving the parent company unable to give a consistent answer about its AI risk exposure to its own board.
Codifying Model Risk Management Across a Multi-Business-Unit Conglomerate
Service Provided
Capabilities Utilized
Model Risk Management, Governance Design, Change Management
Client challenge
One business unit had a mature model review board; two others had informal spreadsheet tracking; the remaining two had no governance process whatsoever. When the board asked for a consolidated view of AI risk across the enterprise, the answer took six weeks to assemble and still had visible gaps.
Our solution
Rather than forcing every business unit onto identical process, we designed a shared governance framework with a common risk taxonomy and reporting format, but allowed each unit to implement it at a pace and rigor appropriate to its own risk profile. A lightweight central function aggregates the reporting quarterly for the board.
We ran the rollout as a change program, not a mandate — working unit by unit to adapt existing review processes into the shared framework rather than replacing them outright, which meaningfully reduced resistance from units that already had working governance in place.
Results
All five business units were reporting into the shared framework within seven months, cutting the board’s quarterly AI-risk reporting cycle from six weeks to four business days. The conglomerate’s audit committee cited the framework as a positive finding in its most recent enterprise risk review, and two business units have since adopted the shared model review board as their primary governance mechanism.
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