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  • C4-4.1 C4-4.1 Risk Governance

    • C4-4.1.1

      The Board of category 4 investment firms is ultimately responsible for the establishment of an adequate and effective framework for identifying, measuring monitoring and managing risks. The CBB expects the Board to be able to demonstrate that it provides suitable oversight and establishes effective systems and controls proportionate to the nature, scale and complexity of the licensee’s activities.

      Added: January 2022

    • C4-4.1.2

      Category 4 investment firms must have a risk management function, independent of risk-taking, commensurate with the nature, scale and complexity of their business. The duties of the risk management function include but are not limited to:

      (a) Identifying, measuring, monitoring, and controlling the major sources of risks associated with the operations of the licensee including any entity it may own, control or manage on an ongoing basis;
      (b) Reporting to the Board and senior management on all material risks the licensee is exposed to; and
      (c) Documenting the processes and systems by which it identifies and monitors material risks, and how it reports to the Board and senior management these risks.
      Added: January 2022

    • C4-4.1.3

      For the purposes of Paragraph C4-4.1.2 and as per Paragraph C4-2.1.10, category 4 investment firms may outsource its risk management function to a third party, provided CBB prior approval is obtained.

      Added: January 2022