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Financial Institution Risk Management Crucial in South Georgia and South Sandwich Islands
The Government of South Georgia & the South Sandwich Islands has issued a new risk management policy to ensure the successful delivery of its strategy, which sets out how the government will assess, manage, and mitigate risks.
The Importance of Risk Management
According to the policy paper, GSGSSI aims to identify, manage, and mitigate risks proactively to avoid unnecessary threats and suitably manage those risks that the government chooses to take. The risk management process is outlined in the policy, which includes five stages:
- Risk Identification: Identifying potential risks
- Describing and Understanding Risk: Describing and understanding the nature of each identified risk
- Reporting Risk: Reporting all identified risks to the relevant authorities
- Managing the Risk: Implementing controls and mitigation strategies to manage and reduce the impact of each identified risk
- Reviewing Risk: Regularly reviewing and updating the risk register
Recognizing Inherent Risks
The policy recognizes that there are inherent risks to successfully delivering its strategy, including:
- Physical Risks
- Financial Risks
- Legal Risks
- Continuity Risks
- Environmental Risks
- Reputational Risks
- Other Business Risks
GSGSSI seeks to avoid accepting or taking unnecessary risks, but acknowledges that some level of risk is inherent in the delivery of its activities and will need to be tolerated.
Managing Risks
To manage these risks, GSGSSI has developed a risk register to define key risks and agreed controls, identify ‘risk owners’, provide a clear audit trail, monitor changes in risk trends, and facilitate the sharing of information. The policy requires that all staff follow procedures for risk management, including:
- Annual Review: Conducting a formal annual review of key risks
- Risk Assessment: Assessing risks for likelihood and impact
- Mitigation Actions: Setting out mitigation actions where possible
- Quarterly Reviews: Reviewing the risk register quarterly
Responsibility and Review
The Chief Executive Officer has overall responsibility for managing each risk, and the GSGSSI Senior Leadership Team will undertake the review process. The policy can be reviewed at any time but must be reviewed within five years of coming into force, replacing Policy No7 of 15 March 2016.
Accessing the Risk Register
The current risk register can be found on the GSGSSI server.