Risk Management is an essential component of the overall corporate governance and internal control structure of an institution. Regulators would expect all regulated firms to have an enterprise-wide risk management process appropriate to the nature of the business undertaken. That process will clearly be more stringent for institutions which are taking deposits or trading than it would for firms which are providing advice or arranging transactions.

The key components of comprehensive Risk Management Framework

No matter the level of risk your Firm is exposed to, you need to have in place a risk management framework which covers the following areas:

  • The tone from the top, i.e., the active involvement of the board in the risk management process, including setting the risk appetite of your Firm
  • An appropriate Risk Management infrastructure, reflecting clarity of responsibility and accountability, together with independent oversight of the risk management framework, all of which should be supported by documented procedures
  • Identification of all risks relevant to your Firm
  • Assessment of the potential impact of each identified risk and an estimate of the likelihood of occurrence of such risk
  • Controls to manage or mitigate those risks
  • Testing of controls to ensure they are operating effectively, and remediating or enhancing the control environment when deficiencies are identified
  • Reporting to senior management and the board

How can CCL help?

CCL has extensive experience in assisting firms to create, develop and maintain their risk management systems. The nature of assistance can be tailored to your specific needs and can include:

We have a dedicated team of experienced compliance consultants who can provide expert assurance and peace of mind. Get in touch to see how we can help your Firm.