Section 4

Section 4 Embed effective risk management, considering both opportunities and threats, throughout the organisation


The Board needs to ensure that the company’s risk management framework identifies and addresses all relevant risks in order to execute and deliver strategy; companies need to consider their extended business, including the company’s supply chain, from key suppliers to end-customer.

Setting strategy includes determining the extent of exposure to the identified risks that the company is able to bear and willing to take (risk tolerance and risk appetite).


Effective risk management in relation to the Company’s portfolio is key to the Board’s assessment of the Investment Manager’s performance. Measuring risk in each investment case, in terms of both how it can be mitigated and the potential upside of taking on such risk are critical elements of the analysis produced by the Investment Manager and reviewed by the Board on each proposed investment. Similarly in conducting the managed disposal programme, the Board is focused on achieving the best possible value for the assets being disposed of, whilst at the same time assessing the risk of maintaining those positions with the potential for further value to be eroded at the same time as requiring additional time to be spent by the Board and Investment Manager.