In support of human understanding: The role of risk communication and visualisation techniques in macroprudential oversight and of visualisation in risk communication.
The policy objective of safeguarding financial stability, which is addressed through macroprudential oversight of the financial system, is currently being accepted and implemented within governmental authorities and supervisors. Big data and analytical models and tools become a necessity for timely and accurate measurement of systemic risks and there is an emphasis on broad and effective communication of these same risks.
As a soft policy intervention, risk communication concerns the overall task of spreading broadly and effectively timely information related to systemic risks, as well as other vulnerabilities concerning the financial system and its macro- financial environment. While a key task is the communication of risks, the toolbox of analytical models lacks a focus on approaches that support human understanding.
This paper discusses the role of risk communication in macroprudential oversight and of visualisation in risk communication, focusing on the background and theory of information visualisation and visual analytics, as well as techniques within these fields, as potential means for risk communication.
Institution(s):
- Goethe University Frankfurt
- RiskLab Finland