Airmic is calling on risk managers to assist boards in meeting their risk management obligations, as set out in the FRC 2014 risk management guidance

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Risk management, internal control and related financial and business reporting replaces the Turnbull Guidance (2005) and outlines six responsibilities of the board, including those related to: risk management processes; principal risks and risk appetite; risk culture and risk assurance; risk profile and risk mitigation; monitoring and review activities; and risk communication and reporting.

Airmic states in the guide published in May: “The role of the risk manager in helping their board achieve compliance with their risk management responsibilities is extensive.”

“There is a clear and increasing need for in-house risk management expertise to help boards and management to fulfil the obligations.”

The guide sets out steps risk managers should take to achieve the Financial Reporting Council’s (FRC) objectives:

  • planning, designing and facilitating the implementation of the overall risk management process for the company;
  • taking account of the effect of related risks materialising at the same time, including catastrophic risk combinations;
  • establishing mechanisms for monitoring the influence of the risk culture to ensure it is achieved in practice;
  • evaluating the procedures for assessing and responding to emerging risks, including reports to the board;
  • establishing processes for senior management to monitor the systems of risk management and evaluate risk performance; and
  • establishing suitable ‘risk radar’ arrangements to provide early warning of changes in the internal and external risk environment.