Barclays 2014 Annual Report Download - page 50

48 I Barclays PLC Annual Report 2014 barclays.com/annualreport
‘A useful opportunity for a more wide-ranging and free-
thinking debate about possible risks that might emerge.’
Dear Shareholders
2014 was the second year of operation of the Committee. It continues
to provide a useful opportunity for a more wide-ranging and free-
thinking debate about possible risks that might emerge and which may
not have been captured by the remit of the Board Financial Risk
Committee or the Board Conduct, Operational and Reputational Risk
Committee.
Demands on the Board’s time meant that the Committee was only able
to meet once as a Committee in 2014, with a planned second meeting
to consider in particular risk appetite for 2015 held concurrently with a
Board meeting. At our meeting, our debate focused on the emerging
risk themes that are being monitored internally, which include political
instability outside the UK, in particular Eastern Europe and the Middle
East; UK political risk, in particular, the Scottish and potential EU
referenda; cyber risk; the UK housing market; and legal and conduct
risk. Specific risks arising from each of these themes are being tracked
and monitored by the Board Financial Risk Committee or the Board
Conduct, Operational and Reputational Risk Committee. We did,
however, spend some time deliberating the potential impact of a ‘yes’
vote in the Scottish referendum, given how uncertain the likely
outcome appeared to be at the time. Although such an eventuality did
not transpire, the main risk for us would have arisen from a disorderly
transition, which may have given rise to redenomination risk. We also
debated the possible indirect impacts, such as the greater likelihood of
a referendum on the UK’s continuing membership of the EU.
We also heard from a third party, who provided an external perspective
on potential ‘over the horizon’ risks. These are risks, which, while of low
probability, may have a significant impact if they crystallise. As a result
of our discussion, we asked the Board Financial Risk Committee to
undertake a closer examination of Barclays’ exposures to central
counterparties in the derivatives market.
Sir David Walker
Chairman, Board Enterprise Wide Risk Committee
2 March 2015
Board Enterprise Wide Risk Committee Allocation of Time (%)
1
2
342014 2013
1Risk Profiles/Risk Appetite 79 61
2Key Risk issues 13 16
3Regulatory frameworks/Risk Policies 410
4Other 413
Committee composition and meetings
The Committee comprises the Chairman, Deputy Chairman and the
Chairmen of each of the principal Board Committees. Reuben Jeffery
(Chairman, Board Conduct, Operational and Reputational Risk
Committee) joined the Committee with effect from 1 April 2014.
The Committee met once as a Committee in 2014, with a further
meeting to discuss and approve Risk Appetite for 2015 held
concurrently with a Board meeting. The meeting held was attended by
management, including the Group Chief Executive, Group Finance
Director, Chief Internal Auditor, Chief Risk Officer, General Counsel and
Head of Compliance. The meeting was also attended by an external
third party, who presented to the Committee an external perspective on
potential future risks.
The chart below shows how the Committee allocated its time in 2014:
Member Meetings attended/eligible to attend
Sir David Walker 2/2
Mike Ashley 2/2
Tim Breedon 2/2
Reuben Jeffery III (from 1 April 2014) 2/2
Sir Michael Rake 2/2
Sir John Sunderland 2/2
Committee role and responsibilities
The Committee’s role is to take an enterprise-wide view of risks and
controls, bringing together the overall risk appetite and risk profile of
the business. It focuses on a holistic view of Barclays’ risk appetite and
risk profile and to seek to identify potential future risks.
You can find the Committee’s terms of reference at
barclays.com/corporategovernance
Governance: Directors’ report
What we did in 2014
Board Enterprise Wide Risk Committee Report