3. RISK MANAGEMENT 3.1 Overview The Group’s mission with respect to risk management is to advance its risk management capabilities, culture and practices so as to be in line with internationally accepted standards and practices. In that regard, the specific objectives of managing risk are to: • • Inculcate a risk-awareness culture throughout the Group; • • Establish a standard approach and methodology in managing risks namely credit, market, liquidity, operational, IT & cyber risk, compliance risks and contagion risk across the Group; • • Clarify functional structures including objectives, roles and responsibilities; • • Implement and use a risk management information system that meets the international standards on confidentiality, integrity and its availability; • • Develop and use tools, such as economic capital, value at risk, and stress testing to support the measurement of risks and enhance risk-based decisions; • • Ensure that risk policies and overall risk appetite are in line with business targets; and • • Ensure that the Group’s capital can support current and planned business needs in terms of risk exposures. 3.2 Risk Management Functional and Governance Structure The Group has aligned its organisational responsibilities with the objective of ensuring a common view of risks across the Group. As a matter of prudence and good governance, the Group’s core risk management functions, which report to the Board Risk Committee (“BRC”), are independent and segregated from the business divisions and centralised at head office. The following illustrates the Group’s governance structure: Shariah Supervisory Council (SSC) Board of Directors Group Chief Executive Officer Management Committee (MANCO) Operational Risk Control Committee (ORCC) Data Management Committee (DMC) Recovery Management Committee (RMC) Rescheduling & Restructuring Oversight Committee (R&R) Boards Nomination & Remuneration Committee (BNRC) Board Financing Review Committee (BFRC) Board Strategic & Sustainability Committee (BSSC) Board IT Committee (BITC) Board Audit & Examination Committee (BAEC) Management Committees Board Committees Board Risk Committee (BRC) Management Audit Committee (MAC) Management IT Committee (MITC) Sustainability Committee (SC) Financing Committees (UIC,FCA, FCB, RFC) Bilob Oversight Committee (BOC) Tender Committee (TECA/TECB) Business Continuity Management Committee (BCMC) Management Risk Control Committee (MRCC) Asset & Liability Management Committee (ALCO) Sadaqa House and Zakat Committee (SHZC) PILLAR 3 DISCLOSURE as at 31 December 2021 BANK I SLAM MALAYS IA BERHAD 388
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