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The Three Lines of Defence

The Three Lines of Defence Model outlines a systematic approach to help businesses clarify the roles and responsibilities necessary to manage risks.

When a company properly structures and operates the lines of defence effectively, the business benefits from the timely identification, assessment and treatment of risks.

Our Three Lines of Defence Model Course outlines the key stakeholders in the model and their main roles.

The course also empowers staff by helping them identify their responsibilities in relation to risk management, including the importance of collaboration and the proactive reporting of risks.

Start your trial Course details
  • 45 Minutes
  • For all staff
  • Based on best-practice risk management frameworks and suitable for global audiences.

Learning objectives

  • Understand and interpret the Three Lines of Defence (3LoD) model
  • Identify the different roles and responsibilities of each line of defence and stakeholder in the 3LoD model
  • Appreciate the benefits of implementing the 3LoD model
  • Identify the key success factors that indicate the 3LoD model is being implemented effectively

    What can you expect your employees to learn?

Welcome

  • Learning objectives
  • How to complete this course

Risk management in our company

  • You decide: True or false?

The 3LoD model

  • You decide: The different components of the 3LoD model

Deeper dive: 1st LoD

  • 1st LoD responsibilities
  • Managing risk
  • Who manages risk in the 1st LoD?
  • Scenario: Exploring the 1st LoD

Deeper dive: 2nd LoD

  • Who manages risk in the 2nd LoD?
  • 2nd LoD responsibilities
  • Scenario: Exploring the 2nd LoD

Deeper dive: 3rd LoD

  • 3rd LoD responsibilities
  • Why is the independence of the 3rd LoD important?
  • Scenario: Exploring the 3rd LoD

What is the role of leadership bodies in the 3LoD model?

What is the role of external stakeholders in the 3LoD model?

  • Types of external stakeholders

The bodies beyond the three lines

What are the benefits of implementing the 3LoD model?

What are common implementation issues with the 3LoD model?

  • In the news
  • How to implement the 3LoD model successfully
  • You decide: The 3LoD model's key factors for success

Escalating concerns

Summary

Affirmation

Assessment

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Your questions, answered

Risk Management

How does conduct risk differ from compliance risk?

Conduct risk focuses on behaviour and outcomes, how actions affect customers and markets -  while compliance risk relates to failing to meet legal or regulatory requirements. Conduct risk is broader and more subjective, often tied to culture and ethics.

Who is responsible for managing conduct risk within a firm?

While senior leadership sets the tone, managing conduct risk is a shared responsibility across all levels, from front-line staff to compliance teams. Everyone plays a role in identifying and mitigating risky behaviour.

Can conduct risk exist in non-financial sectors?

Yes. Although the FCA regulates financial services, conduct risk principles apply across industries. Any business that interacts with customers or influences markets can face conduct-related challenges.

How can technology help reduce conduct risk?

Tools like automated monitoring systems, AI-driven analytics, and e-learning platforms can help detect risky patterns, reinforce ethical behaviour, and ensure consistent training across teams.

How often should proliferation financing risk assessments be updated?

Best practice suggests reviewing risk assessments annually or whenever there are significant changes in business operations, customer profiles, or geopolitical developments.

Why is risk scoring important for my business?

Identifying potential risks around your business is not enough. Tracking how your company manages them helps you implement policies to prevent them. The best way to get started is with a risk scoring matrix.

What is a risk scoring matrix?

A risk scoring matrix helps identify the level of risk for specific activities, such as personal data. By measuring the likelihood of something happening against how serious the consequences would be, it helps you see which areas to focus on. And what policies or procedures to put in place.

Related courses

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