Positioning for the Future | 49
Enterprise Risk Management
Risk management is an integral part of CapitaLand’s
business at both the strategic and operational level.
A proactive approach towards riskmanagement supports
the attainment of the Group’s business objective and
corporate strategy of ONE CapitaLand, thereby creating
and preserving value.
The Group recognises that risk management is about
opportunities as much as it is about threats. To capitalise
on opportunities, the Group has to take risks. Therefore,
risk management is not about pursuing risk minimisation
as a goal but rather optimising the risk-reward relationship,
within known and agreed risk appetite levels. The Group
therefore takes risks in a prudent manner for justimable
business reasons.
The Board of Directors (Board) is responsible for the
governance of risk across the Group. The responsibilities
include determining the Group’s risk appetite, overseeing
the Group’s Enterprise Risk Management (ERM)
Framework, regularly reviewing the Group’s risk promle,
material risks and mitigation strategies, and ensuring
the effectiveness of risk management policies and
procedures. For these purposes, it is assisted by the
Risk Committee (RC), established in 2002, to provide
dedicated oversight of risk management at the Board
level.
The RC currently comprises four independent board
members and meets on a quarterly basis. The meetings
t Accept
t Avoid
t Mitigate
e.g. Business
Continuity Management
t Transfer
e.g. Contractual Risk
Management & Insurance
t Key Risk Indicators
t 2uarterly Risk
Reporting
t Portfolio Monitoring
of Financial Risk
e.g. Country
Concentration, F9, etc
ERM Framework
Risk Strategy
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Independent Review & Audit
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t Risk Appetite
t Risk & Control
Self-Assessment
t Investment Risk Evaluation
t 2uantitative Analysis
t Scenario Analysis
t Whistle-blowing/
Business Malpractice
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& Assessment
Risk
Response
Risk Monitoring
& Reporting
Enterprise Risk Management Framework
are regularly attended by the President & Group CEO
(P&GCEO) as well as other key management staff.
The RC is assisted by the Risk Assessment Group
(RAG), a dedicated and independent in-house team
comprising highly specialised and professional
members with vast and diverse experience in mnancial,
operational and enterprise risk management.
The Board has approved the Group’s risk appetite
which determines the nature and extent of material risks
which the Group is willing to take to achieve its strategic
objectives. The Group’s Risk Appetite Statement (RAS)
is expressed via formal high-level and overarching
statements and incorporates accompanying risk limits
which determine specimc risk boundaries established at
an operational level. )aving considered key stakeholders’
interests, the RAS sets out explicit, forward-looking
views of the Group’s desired risk promle and is aligned to
the Group’s strategy and business plans.
A team comprising the P&GCEO and other key
management personnel is responsible for directing
and monitoring the development, implementation
and practice of ERM across the Group. Operationally,
a network of risk champions from the different Strategic
Business Units (SBUs) and corporate functions, as
well as various specialist support functions, are tasked
to develop, implement and monitor risk management
policies, methodologies and procedures in their
respective areas.
Corporate Governance & Transparency
