Recruiter's Glossary

Examples: Inherent Risk • Reputational Risk • Near Miss

Three Lines of Defense

Term from Risk Management industry explained for recruiters

The Three Lines of Defense is a common way of organizing how companies manage their risks and ensure everything runs smoothly. Think of it like having three layers of protection for a company. The first line is the regular business teams who handle risks in their daily work. The second line includes risk and compliance teams who oversee and guide the first line. The third line is internal audit, who independently checks that everything is working properly. This approach is widely used in banks, insurance companies, and other regulated industries to keep things organized and safe.

Examples in Resumes

Implemented Three Lines of Defense model across multiple business units

Led training sessions on 3 Lines of Defense framework for new employees

Developed reporting structures aligned with Three Lines of Defence principles

Enhanced risk management using the 3LOD framework

Typical job title: "Risk Management Professionals"

Also try searching for:

Risk Manager Compliance Officer Internal Auditor Risk and Control Specialist Governance Professional Risk Assessment Manager Internal Control Manager

Where to Find Risk Management Professionals

Professional Associations

Online Communities

Job Resources

Example Interview Questions

Senior Level Questions

Q: How would you implement the Three Lines of Defense model in a company that has never used it before?

Expected Answer: A senior candidate should discuss creating a structured plan, including defining roles and responsibilities, establishing reporting lines, training staff, and managing the cultural change. They should mention working with executives and handling potential resistance to change.

Q: How do you ensure effective communication between all three lines of defense?

Expected Answer: Should explain practical approaches to coordination between business units, risk/compliance teams, and internal audit, including regular meetings, clear reporting processes, and tools used to share information.

Mid Level Questions

Q: What are the main responsibilities of the second line of defense?

Expected Answer: Should explain how risk management and compliance teams support the first line, develop policies, monitor risks, and report to senior management, using simple business examples.

Q: How do you handle conflicts between different lines of defense?

Expected Answer: Should describe practical approaches to resolving disagreements between business units, risk teams, and internal audit, focusing on communication and problem-solving.

Junior Level Questions

Q: Can you explain the Three Lines of Defense model in simple terms?

Expected Answer: Should be able to clearly explain the basic concept: first line (business operations), second line (risk and compliance), and third line (internal audit), using simple examples.

Q: What is the role of the first line of defense?

Expected Answer: Should explain how business units handle day-to-day risk management in their operations, using basic examples like following procedures and identifying risks in their work.