In many organisations, the board is taking a wider view on risk management in order to consider both hazards and opportunities. This guide looks at what boards should consider when establishing a risk management framework and the ongoing requirements for its effectiveness.
Integrating risk management into the business planning cycle is an important component of good risk management. This article looks at the relationship between risk management and business planning, and provides a model for integrating them in the process.
Before considering risk management it is necessary to identify the strategic and organisational context under which an organisation operates. After establishing the context, we then need to clarify the strategy for risk management.
The board is required to ensure there is an effective system of risk management in the organisation. This guide contains essential questions for directors to ask when assessing financial risk and assists with the preparation of the annual report.
In considering financial risk, management and the board need to understand the full context of these risks. This guide describes financial risk categories and provides specimen questions that could help to show whether a particular risk is relevant to the organisation. The answers to the questions can help in constructing an appropriate risk management policy.
Management and the board have an obligation to identify risks and ensure that appropriate people in the organisation are made aware of them. This guide looks at how to identify and categorise risks that exist in an organisation, and provides templates for developing the categories. This format can be used to communicate both to the board and to operational management.
Treatment of risks a detailed evaluation of treatment options
A range of issues need to be considered when making decisions on the treatment of risks. This guide analyses the various options available in the treatment of risks: avoiding activity that creates the risk; accepting or retaining the risk; reducing the likelihood of an occurrence; insuring the risk; and a plan of implementation.
An organisation needs to document and approve policies for the management of financial risks and the use of financial instruments. This guide summarises the different types of financial risks, and provides relevant questions that should be addressed in managing them.
The risk management process, involving the identification, analysis, evaluation, communication, treatment and monitoring of risk, is well documented. It requires organisational support to ensure risk management is part of the culture of the enterprise. This template provides an effective way to communicate the organisations risk profile.
Companies should document their risk management policy in order to assess the effectiveness of their risk management systems. This template policy provides a framework against which this assessment can be conducted.
The operational risk management procedures of treasury must be documented to ensure compliance. The attached template policy covers areas that must be considered in the operational management of a hedging program for commodity and currency risk where financial instruments are used to manage these risks. The concepts can also be used for other areas of treasury operations management.
Insurance coverage is a key component of risk mitigation for companies. This insurance quick reference guide provides an overview of the types of risks and describes the organisations coverage policy. It can be used to understand both insured and uninsured risks.
This guide provides a checklist of contract terms and a template to compare the companys preferred position and actual terms. This template can be used in conjunction with decision rights authorities.
Companies operating internationally require a rigorous compliance environment in relation to banking structures, credit limits and funding arrangements. This documented guide provides a structured approach to review compliance with Group Treasury policies. A structured treasury policy review is an important step in ensuring there is a sound system of internal control.
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