The Strategy and Operational Risks Function (SORF) is responsible for:

• strategic planning; 
• ensuring immediate application of the methodological framework and coordinated operational risks management.

Strategic planning is a creative and inclusive process, which defines strategic goals and expected results, taking into account human potential, financial resources and changes in the environment. Strategic Plan contains the basic strategic goals for the next three years and is determined according to the mission, vision and organizational values of the National Bank, depending on the macroeconomic environment and key challenges.

The Strategic Plan serves as a basis for preparation of the Plan of Activities, which  is aimed at ensuring implementation of the strategic objectives by optimal targeting of available resources to priority areas, to strengthen all work capacities, to improve the quality of operations, thus ensuring monitoring and evaluation of the results and effectiveness of the measures and activities taken. Both the Strategic Plan and the Plan of Activities are adopted by the National Bank Council. 

Strategy and Operational Risk Function (SORF) has the following responsibilities:

• organization and implementation of the strategic planning process;
• coordination of activities for its improvement and development;
• semi-annual reporting on the execution of program activities to the strategic managers;
• annual reporting on the realization of the Plan of Activities, which is part of the Annual Report of the National Bank, approved by the National Bank and published on the web site. The Annual Report of the National Bank is submitted to the Assembly of the Republic of North Macedonia and to the Minister of Finance.

The risk management is a necessary element of the good corporate governance which contributes to the efficient realization of the set strategic objectives, mandate and vision. Having in mind the rising importance of the risk management, a separate strategic goal aimed at strengthening risk management in Strategic Plan for 2022 ‒ 2024 is envisaged. Operational risk management enables better decision-making, increased efficiency, better forecasting and optimization of available resources and increased risk awareness in the National Bank.

The operational risk management framework of the National Bank provides a system of coordinated, comprehensive and systematic operational risk management in order to determine the events that may affect the functioning of the National Bank, maintenance of the exposure to risks within acceptable limits and effective accomplishment of the objectives. Operational Risk Management Policy is based on international standards, principles and central banking practices for operational risk management.

The process of managing operational risks in the National Bank is set on a centralized basis, in terms of the application of methodologies and reporting system, but is dispersed in terms of its implementation. Operational risk management is performed by several organizational levels in the National Bank, and the tasks and responsibilities will be allocated to:

The Strategy and Operational Risk Function (SORF), as an organizational unit belonging to the second line of defense, has the task to provide direct application of the methodological framework and coordinated operational risks management in the National Bank. SORF has full autonomy and independence in its operating and is accountable for its operations to the Governor of the National Bank.

SORF has the following competence:

• implementation of the Operational Risk Management Policy;

• regular monitoring of the National Bank's exposure to operational risks relative to the determined level of operational risk tolerance  through collection of data and reports on risk management prepared by the organizational units;

• regular semi-annual reporting to the National Bank Council on the exposure to operational risks through the Operational Risk Management Committee, and if necessary, submits more frequent reports on significant exposure to operational risks;

• increasing the risk awareness in the National Bank, as well as providing appropriate training and transfer of practical experiences for operational risk management.

The Operational Risk Management Committee is responsible for providing conditions for the development and consistent application of the risk management framework and for monitoring the implementation of the measures for dealing with operational risks. The work of the Operational Risk Management Committee, as a body responsible for implementiation of the Operational Risk Policy shall be regulated by Rules of Procedure adopted by the Governor.