9APRIL JUNE 2024CFO TECH OUTLOOKand questionnaires. Discovering emerging risks requires deep industry knowledge, specialization by risk type, and a wide network of contacts inside and outside the organization.Usually, it is the strategic risk management function within the company that maintains a list of strategic threats and risks with regular updates, including the probability of their occurrence and their effect. The risk management function must regularly interact with internal counterparties, external experts, and market participants. Another aspect of strategic risk management is the development of a mitigation plan with risk owners. The mitigation plan includes stages and detailed actions to be undertaken to decrease and cover strategic risk.The role of the strategic risk management function is to identify, anticipate, and quantify strategic risks and to inform the Board of the company in order to make sustainable decisions for the future development of the business. Significant challenges could lead to a change in the company's development direction. Risk appetite and business strategic planning have to be integrated and interconnected. The risk appetite is the level of risk established for each risk category that the company is willing to accept, considering the established risk strategy and business conditions. Therefore, the risk appetite framework is the tool that sets and limits the level of overall risk the institution is willing and able to take on to achieve its strategic and business goals. The relationship between risk appetite framework and strategic planning is an interactive process. Thus, it is ensured that the risk appetite framework fully accounts for and reflects the strategy. On the other hand, it is also important for strategic planning to include discussions on the risk appetite and the risk profile. The active participation of the Board and company management plays a key role in ensuring that strategic risk management has a strong and sustainable impact on the organization. The active participation of the Board and company management plays a key role in ensuring that strategic risk management has a strong and sustainable impact on the organization
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