4.2 Risk management organisation Inhoudsopgave Voorwoord Bestuursverslag Corporate governance Consolidated Financial Statements Company Financial Statements Pillar 3 increased substantially. We are unifying our steering of data management and data governance projects. Business conduct: Conduct issues impede public trust and may affect Rabobank. Regulatory scrutiny has continued to increase since the start of the financial crisis and has resulted in hundreds of billions in fines for product suitability, sanctions and market abuse in the financial services industry. Moreover, strict adherence to legislation is no longer sufficient. Most issues have long lead times, both in discovery and in remediation so (legacy) conduct issues may continue to emerge. We are furher improving the implementation of regulations, client onboarding, the risk control framework, customer integrity and employee awareness. Employees: Keep staff fully engaged during a transition period and maintain a healthy flow of key positions. Although collaboration across and between departments has improved, our staff reduction inevitably impacts all employees. Staff mobility and a change-mindset are needed, in addition to a sound risk culture in which risks are identified, escalated and managed proactively and in a timely manner. Our strategic HR improvements focus on performance management, talent management, diversity and an adaptive way of working. Balance sheet:This includes funding gaps, capital availability and respective pricing. Serving the Dutch society and the food agri sector means continuously balancing our strategic focus and the potential risk of concentration in assets and liabilities. We are reducing our balance sheet through proactive portfolio management and advancing our planning and budget processes. External environment: These factors include continuing economic instability, climate change, serious geopolitical unrest and emerging market contagion. A potential economic downturn poses threats to worldwide growth and adds to financial market uncertainty. Climate change may negatively impact the business of our customers, so sustainability is becoming increasingly important to them. We support them in achieving a long-term social and ecological balance.The eurozone is under pressure, as tensions increase between European countries, growth in China is slowing down and developments in other emerging markets could have a contagious effect on trade. This may result in protectionism and the freezing of world trade. We are monitoring macro-economic and geopolitical developments closely and enhancing our focus on sustainability and portfolio management, including stress testing. Every Rabobank employee is involved in addressing and managing risks on a daily basis. Rabobank has adopted the 'three lines of defence' model to provide clarity on the responsibilities for risk and control activities. This clarity of responsibilities results in coordinated, efficient and effective risk and control activities throughout the bank.The three lines of defence approach lays the foundation for the overall risk governance in Rabobank. The Risk Management function is organised in units which can be divided in three main groups: 1.Risk profile governance: monitoring of the Group risk exposures and maintenance of the risk management governance, framework, models and data: a ALM Analytics: interest rate risk, funding liquidity risk, ownership of models for credit, provisioning and ALM, project management and risk management systems; b Integrated Risk: capital risk management and stress testing, risk framework and governance including group risk appetite and risk committees, regulatory oversight, supervisory relations and recovery resolution management. 2. Business domains: implementation and enforcement of the risk framework, provide boundaries, challenge and oversight within entities, subsidiaries and at group level: a Risk Retail NL: b Risk Wholesale Rural Retail includes market risk policies and methodologies, and second line monitoring of Treasury (except ALM) and Portfolio Management; c Risk IT Operations includes model validation. 3. Functional expertise: policy development and delivery of support to the business: a Credit: credit and development of (provisioning) policies, credit approval and credit risk monitoring and reporting (e.g. portfolio, concentrations, country limits), transactional risk committees; b Financial Restructuring Recovery (FR&R): recovery and restructuring of credit for clients at risk of financial distress, accountability for provisioning and signoff-related policies; c Operational Risk: expertise centre on operational risk, including BCM and group insurances (reporting into RMC RG). 315 4. Risk management

Rabobank Bronnenarchief

Jaarverslagen Rabobank | 2016 | | pagina 316