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Risk management mechanisms
ABIL believes that risk management is fundamental to effective corporate governance and the development
and maintenance of a sustainable business. ABIL’s risk methodology and philosophy allows the various
business units to ensure business success with a measured balance between risk and reward.
The group operates in a structured manner with defi ned processes and procedures enabling risk assessment
within a controlled environment. Accordingly, an assessment of key risks is performed with weightings on
impact and probability assigned. Existing controls are assessed and, if necessary, adjusted. Thereafter
reports are generated at regular intervals to enable monitoring of risk levels.
ABIL’s objective with risk management is to ensure a proactive identifi cation, understanding and assessment
of risks, including activities undertaken that yield risks which could impact on business objectives. This is
executed through various risk management and governance mechanisms and risk management oversight
bodies. These include:
Independent board committees (audit, risk and capital management, remuneration, director’s affairs and
social and ethics committees);
Risk management function co-operation in all key operations throughout the group;
Assurance from internal audit on the control environment;
Fraud risk management through an independent forensic department;
An operational risk department operating as business partners to all business units to facilitate,
co-ordinate and monitor effective risk management;
Compliance department; and
Group legal advisors.
ABIL fi rmly utilises and applies a holistic and integrated risk management approach. Included in the risk
management mechanisms is the principle of ‘levels of defence’. Business units, group risk management
services together with internal and external audit participate in the holistic approach to risk management.
Three levels of defence as applied throughout the group
Group Internal
Audit and External
Audit
Group Risk
Management
Group Exco and
Business Units
Integrated report 2011 | African Bank Investments Limited 77