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ECCB ANNUAL REPORT 2016/2017
OFFICE OF RISK MANAGEMENT
The international financial landscape has undergone
significant changes in recent years which have
heightened the importance of robust risk management
regimes within organisations to mitigate the attendant
risks in the global operating environment. Traditional
risk management practices, where risk was primarily
viewed as a series of single elements to be addressed
individually, gave rise to the creation of silos within
organisations and detracted from the overall
achievement of strategic objectives. In response to
these shortcomings, companies have adopted an
Enterprise Risk Management approach. The intention
is to develop a holistic view of the most significant
risks that can deter or otherwise negatively impact the
achievement of the entity’s key objectives.
In response to this paradigm shift, an Office of Risk
Management was established to implement an
Enterprise Risk Management Framework. A Chief Risk
Officer was appointed in September 2016 to lead this
initiative. This separation of the risk function is in line
with international best practices and facilitates greater
efficiency in meeting the Bank’s objectives.
This new focus on risk management extends to the
Board of Directors. Consequently, the role of the Board
Audit Committee was expanded to include oversight
of the Enterprise Risk Management functions and
the Charter was updated to reflect the added
responsibilities. The Board Audit subcommittee was
renamed the Board Audit and Risk Committee, (BARC)
indicative of the increased focus.
As part of the mandate for the development of the
Enterprise Risk Management Framework, the Chief
Risk Officer has responsibility for leading various
initiatives including:
•
•
The development of a concise Risk Appetite
Statement with clearly defined risk tolerances
to guide the risk management operations
throughout the Bank. This would be supported
by clearly defined roles within the governance
structure to support the Risk Management
Framework at all levels including, Board of
Directors, Executive Committee, Department
Heads, management and operational staff;
•
•
Oversight of the Disaster Recovery and Business
Continuity Management Programme;
•
•
Facilitating training sessions in riskmanagement
at all levels; and
•
•
The development and implementation of
appropriate tools and methodologies for risk
measurement and reporting.
In formulating the Bank’s Risk Appetite, requisite
attention is given to the inherent risks associated with
the broad areas of monetary policy, financial sector
stability, management of the Payment and Settlements
System and the daily operational tasks undertaken to
support these functions.
The Office of Risk Management was established to implement an Enterprise Risk
Management Framework. A Chief Risk Officer was appointed in September 2016, to
lead this initiative.