ModelRefs / Model Risk Management (MRM) — AI Glossary
Model Risk Management (MRM) — AI Glossary
A governance framework for identifying, measuring, and controlling risks arising from quantitative models, extended to AI and LLMs.
Overview
MRM (SR 11-7, OCC 2011 guidance) originated in financial services for credit and trading models. Applied to AI: model validation (independent review of training, assumptions, limitations), ongoing monitoring (performance drift, distribution shift), and model inventory. Banks and insurers now apply MRM to LLM-based decision models.
Reference details
| Topic | safety |
|---|---|
| Last reviewed | 2026-06-24 |
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Frequently asked questions
What is Model Risk Management (MRM)?
A governance framework for identifying, measuring, and controlling risks arising from quantitative models, extended to AI and LLMs.
What concepts are related to Model Risk Management (MRM)?
Closely related concepts include ai audit, nist ai rmf, responsible ai.