Building a Risk Management Function from Scratch
Designing, developing, and implementing a robust Risk Management function from the ground up, including the establishment of a risk governance structure, risk registers, and risk appetite statements
Client Need
The client, a renowned Global Corporate Services Firm based in Hong Kong, acknowledged the requirement for a sophisticated Risk Management function to navigate its increasing global operational complexities. The objective was to proactively identify, assess, and mitigate risks within its operations and decision-making processes. As a greenfield project, the function required a comprehensive and scalable strategy, a framework built from the ground up that would align with the firm's existing operations and future growth ambitions.
Role
We utilized our extensive knowledge in risk management to develop a customized framework for the client. This began with a meticulous analysis of the firm's operations to understand specific risk exposure and the existing risk management mechanisms. Subsequently, we designed an extensive risk management strategy incorporating crucial elements to give the firm the tools to identify, assess, mitigate, and monitor their risks across the organisation
A significant part of our role involved helping the firm establish a risk governance structure that defined roles, responsibilities, and reporting lines to ensure effective risk management. We guided the creation of a top risk register, providing a structured approach to record and monitor identified risks. Additionally, we assisted in the formulation of their risk appetite statement and associated metrics, enabling the firm to articulate the level of risk it was willing to accept.
In the implementation phase, we worked closely with the firm to integrate the new Risk Management function seamlessly into their existing organizational structure. This involved conducting training sessions to ensure employees understood their roles within the new framework. We also supported the recruitment and training of a specialized risk management team to oversee the newly developed function.
Value Added
The establishment of the Risk Management function provided the client with a systematic approach to identify, assess, and manage potential risks, leading to improved decision-making and enhanced operational efficiency. The implementation of a risk governance structure, risk registers, and risk appetite statements provided an organized and efficient method to manage risk, promoting transparency and accountability.
The new Risk Management function enhanced the firm's resilience and business continuity by providing a structured approach to navigate uncertainties inherent in their global operations. Moreover, the scalability of the function ensured its adaptability to the firm's future growth.
The greenfield development of the Risk Management function not only safeguarded the client's operations but also armed them with a robust and comprehensive framework to manage risks proactively. By aligning the function with the firm's strategic plans, we ensured it could support the firm's sustainability and long-term growth goals.