Connecting the nation. and Beyond. - ChartNexus

132 / MRCB laporan tahunan 2011 /
rIsK management report
One of the strategic moves made by the Board in its efforts to
protect shareholders value is the establishment of an integrated
and structured enterprise risk management process within
the Group. Since February 2003, the Board together with the
Management have developed and implemented structured
Enterprise Risk Management (“ERM”) practices throughout the
Group.
To provide a foundation for enterprise risk management in the
Group, the Management had designed a Risk Management
Framework and Manual (“RMF”) which was approved by the
Board on 17 February 2003. This Framework was implemented
throughout the Group. In 2011, a comprehensive review of
the RMF was undertaken to align the RMF with best practices
recommended by the COSO Enterprise Risk Management –
Integrated Framework and to ensure that it remains relevant and
effective for the pro-active management of risks, particularly
the strategic risks of the Group, in its present operating
environment.
KeY revIsIons maDe to tHe rmF Were as FoLLoWs:
a The Group’s policy on managing risk was enhanced with
the introduction of the concept of the risk of unrealised
opportunities;
b Risk categories were revised and expanded to reflect the
expansion of the Group’s scale and scope of operations;
c A common set of risk definitions for key risk events were
developed to facilitate uniformity of understanding
throughout the Group;
d The granularity of the risk rating scale was expanded from
a 2x2 scale to a 4x4 scale in response to management’s
improved understanding of risks; and
e The roles and responsibilities of the various parties involved
in risk oversight were refined and aligned with changes in
the organization and reporting structure that have taken
place since the last review of the RMF.
The Corporate Governance Department is responsible for
developing, coordinating and facilitating the ERM processes
within the Group.
rIsK reportIng anD monItorIng
The Board has delegated to the AC the responsibility to oversee
and monitor all risk management activities of the Group. In this
respect, the AC is assisted by the CEO and a Risk Management
Working Committee (“RMWC”), which comprises key senior
management personnel of the Group.
The RMWC, which meets on a quarterly basis, monitors the
effectiveness of the risk mitigating actions that have been
proposed by management, evaluates and monitors the risk
management infrastructure and facilitates the risk management
process throughout the Group.
rIsK management sYstem
During the year under review, the Corporate Governance
Department had worked with the Information Technology
Department to develop an IT–enabled Risk Management System
to facilitate the documentation, monitoring and reporting of
risks, controls and mitigating action plans throughout the Group.
The Risk Management System has been operational since the
3rd Quarter of 2011.
To introduce the revised Risk Management Framework and Risk
Management System to the senior and middle management
team of the Group, various briefing and system demonstration
sessions were conducted by the Corporate Governance
Department. The Corporate Governance Department also
actively engaged with senior and middle management to share
information and current thinking on risk management in an effort
to embed risk-consciousness into the culture of the Group.
The MRCB Board and Management constantly reviews the
effectiveness of the Group’s risk management system and will
continue to devote the appropriate amount of resources to this
end.
this risk management report is approved by the Board of
Directors via its resolution on 14 February 2012.
tan sri azlan Zainol
Chairman
malaysian resources corporation Berhad