Jupiter Annual Report 2010 - Jupiter Asset Management

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Governance | Directors’ report Risk management and internal control report The Board is accountable for risk and is responsible for oversight of the risk management process. Jupiter’s Corporate Governance Framework Jupiter Fund Management plc Board Executive Committee Audit* Committee Remuneration* Committee Nomination* Committee Risk Committee Balance Sheet Management Committee Product Development Committee Operations Committee TCF Committee *Board committees composed of non-executive Directors of Jupiter Fund Management plc. Risk management framework The Board is accountable for risk and is responsible for oversight of the risk management process. The Board has ultimate responsibility for the risk strategy of the Group and for determining an appropriate risk appetite and tolerance levels within which the Group must operate. By defining these, the Board demonstrates that it is aware of and, where appropriate, has taken steps to mitigate the impact of risks that may have a material impact on the Group. The Executive Committee reviews the key corporate risks facing the Group. The Chief Financial Officer has responsibility for the risk and control framework within the Group and the independent monitoring and reporting of risk and controls. The Chief Financial Officer, through a Risk Committee, manages the ongoing development of the Group’s risk and control framework. Jupiter embeds risk management within the business, with independent oversight and challenge being provided by the risk function. Governance arrangements Overall framework In terms of risk within this structure, as per the chart above, the Board has ultimate responsibility for risk strategy and risk appetite. The Board delegates the review and challenge of the effectiveness of risk management arrangements within the Group to the Audit Committee. Jupiter has an outsourced internal audit function, supplied by Ernst & Young LLP, which provides the Audit Committee with an assessment of internal systems and controls. Its approach is undertaken in accordance with a risk-based audit plan, taking into consideration information provided by the Operational Risk and Compliance departments as well as any other concerns identified through discussions with senior management and Audit Committee members. Annual Report & Accounts 2010 48 Jupiter Fund Management plc
Governance | Directors’ report Committee structure A description of each of the individual committees assisting the Board with discharging its responsibilities in respect of risk monitoring and mitigation is set out below. Executive Committee Risk Committee Balance Sheet Management Committee Product Development Committee Operations Committee TCF Committee Executive Committee The purpose of the Committee is to provide an efficient forum for discussion and decision making regarding the development of the business in accordance with the strategy and objectives set by the Board. The minutes from this meeting are made available to the Chairman of the Board. The Committee meets weekly with one meeting every fortnight having a formal agenda and minutes. The following committees report to the Executive Committee. ■■ Risk Committee ■■ Balance Sheet Management Committee ■■ Product Development Committee ■■ Operations Committee ■■ TCF Committee Risk committee The Committee provides support to the Executive Committee on the establishment, implementation and maintenance of adequate risk management policies and procedures. In particular, it advises the Executive Committee on: Balance sheet management committee The Balance Sheet Management Committee provides support to the Executive Committee on the establishment, implementation and maintenance of adequate balance sheet management policies and procedures. It advises the Executive Committee, on both a current and forecast basis, on the areas under its remit, as well as reviewing the risk and control issues facing the Group in those areas. Product development committee The purpose of the Committee is to ensure that the proposals submitted for approval have been adequately considered to enable a decision in principle to proceed or not proceed, as the case may be. TCF is an integral part of the Committee’s deliberations in respect of sign off, implementation and post launch analysis. This applies to Jupiter’s product range, including UK unit trusts, SICAVs, hedge funds and investment companies. Operations committee The purpose of the Committee is to provide a forum through which senior management can discuss ongoing and proposed operational changes to the business and consider any implications across departments. The Committee reviews Health & Safety practices and any material risks or incidents occurring. The Committee considers any significant errors occurring during the year and any pertinent risk assessment findings from the Operational Risk function. TCF committee The purpose of the Committee is to consider how UK unit trust and SICAV product launches and enhancements have been executed, including Legal, Operational, Marketing, Funding and PR from a TCF perspective. Pre-launch TCF issues are considered and documented through the completion of new product/product enhancement forms. Postlaunch/implementation, the TCF Committee will look at available management information (including performance, target audience, distribution approach, market share analysis, subscription and redemption patterns, administration statistics and complaint data) to consider whether the products continue to meet the general needs of the target audience that they were designed for. They will also consider whether performance is in line with what was expected and communicated to the distributor at the time of sale. ■■ ■■ ■■ the appropriate level of risk to be tolerated by the Group (“risk appetite/tolerance”); the management of risks within the determined risk tolerances; and the effectiveness of risk management processes across the business, including compliance with such policies and remedial action. The Committee reviews the Group’s primary risk exposures (with consideration of impact and probability assessments) in the context of the Board’s tolerance thresholds and ensure that the governance arrangements within the Group are effective in the mitigation of risk. The scope of the Committee’s remit encompasses risk control issues facing the Group in relation to operational risk, investment risk (including counterparty) and new product risks (competency and capacity aspects). The Risk Committee is supported by the Operational Risk department, which provides assurance to internal and external stakeholders on the Group’s risk management activities. It is an independent function that supports and challenges the business on their assessment of risks and controls. Annual Report & Accounts 2010 49 Jupiter Fund Management plc
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Jupiter Annual Report 2010 - Jupiter Asset Management

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