JUST GROUP PLC Annual Report and Accounts 2019
34
Risk management
The Group’s enterprise-wide risk management strategy is to enable all colleagues to take more effective business decisions through a better understanding of risk
PURPOSE We use risk management to make better informed business decisions that generate value for shareholders while delivering appropriate outcomes for our customers and providing confidence to other stakeholders. Our risk management processes are designed to ensure that our understanding of risk underpins how we run the business. RISK FRAMEWORK Our risk management framework is continually developed to reflect our risk environment and emerging best practice. The framework, owned by the Group Board, covers all aspects of risk management, including risk governance, reporting and policies. Our appetite for different types of risk is embedded across the business to create a culture of confident risk taking. RISK EVALUATION AND REPORTING We evaluate our principal and emerging risks and decide how best to manage them within our risk appetite. Management regularly reviews its risks and produces reports to provide assurance that material risks in the business are being appropriately mitigated. The Risk function, led by the Group Chief Risk Officer (“GCRO”), challenges the management team on the effectiveness of its risk evaluation and mitigation. The GCRO provides the Group Risk and Compliance Committee (“GRCC”) with his independent assessment of the principal and emerging risks to the business. Financial risk modelling is used to assess the amount of each risk type against our capital risk appetite. This modelling is principally aligned to our regulatory capital metrics. This modelling allows the Board to understand both the risks included in the Solvency Capital Requirement (“SCR”) and how they translate into regulatory capital needs and those not included in the SCR, such as liquidity and strategic risks. By applying stress and scenario testing, we gain insights into how risks might impact the Group in different circumstances. OWN RISK AND SOLVENCY ASSESSMENT The Group’s Own Risk and Solvency Assessment (“ORSA”) embeds comprehensive risk reviews into our Group management structure. Our annual ORSA report is a key part of our business cycle and informs strategic decision making. ORSA updates are prepared each quarter to keep the Board appraised of the Group’s evolving risk profile.
High Impact
Medium High Impact
A
C
B
Low Impact
1–3 years
Monitor & analyse as required
Analyse & make plans where needed
Act
Monitor & understand
Monitoring
Planning
TIMESCALE AND MANAGEMENT ACTIONS
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