Board of Directors' Responsibility
RM-1.1.1
The Board of
Directors ofinvestment firm licensees must take responsibility for the establishment of an adequate and effective framework for identifying, monitoring and managing risks across all its operations.Adopted: July 2007RM-1.1.2
The CBB expects the Board to be able to demonstrate that it provides suitable oversight and establishes, in relation to all the risks the
investment firm licensee is exposed to, a risk management framework that includes setting and monitoring policies, systems, tools and controls.Adopted: July 2007RM-1.1.3
Although authority for the management of a firm's risks is likely to be delegated, to some degree, to individuals at all levels of the organisation, the overall responsibility for this activity should not be delegated from its governing body and relevant senior managers.
Adopted: July 2007RM-1.1.4
An
investment firm licensee's failure to establish, in the opinion of the CBB, an adequate risk management framework will result in it being in breach of Condition 6 of the Licensing Conditions of Section AU-2.6. This failure may result in the CBB withdrawing or imposing restrictions on thelicensee , or thelicensee being required to inject more capital.Adopted: July 2007RM-1.1.5
The Board of
Directors must also ensure that there is adequate documentation of thelicensee's risk management framework.Adopted: July 2007
