The importance of risk management and the areas of responsibility
Risk management is of central importance in maintaining Finnvera’s ability to take risks and in attaining economic objectives in the long run. The goal of risk management, for its part, is to ensure the prerequisites for implementing the company’s strategy.
Finnvera’s Board of Directors and executive management are responsible for arranging and organising internal control and risk management. The Board of Directors approves decision-making powers, the principles of risk management and risk policies. The Board and its Inspection Committee monitor the development of the Group’s risk position through regular quarterly reporting.
Working independently of Finnvera’s business areas, the Risk Management Unit is responsible for developing risk management methods, for providing guidelines and participating in activities and for monitoring the Group’s risk position. The Risk Management Unit reports directly to the Chief Executive Officer. The areas of responsibility also include coordinating the development and maintenance of the risk classification systems and monitoring the functionality of the classification systems.
The practical measures regarding risk management are part of the day-to-day management and are implemented by the entire Finnvera organisation and the Group companies.
Risk classification and the process
Finnvera’s Board of Directors confirms the principles of the Group’s risk management, the goals of risk-taking, the policies observed, the outlines, and the decision-making powers.
Finnvera’s risks can be grouped as follows:
- risks pertaining to credits and guarantees;
- operational risks;
- liquidity and market risks;
- other risks.
Operational risks pertaining to financial reporting are identified, assessed and controlled as part of operational risk management. The utilisation of information technology plays a central role in financial reporting.
The internal reporting system for risk management works at all levels of the Group. The parent company manages risks arisen in subsidiaries through ownership steering and by keeping all subsidiaries within the sphere of the risk management and internal auditing practised within the Group.