Barclays 2006 Annual Report Download - page 74

Barclays PLC
Annual Report 2006
70
Risk management
Risk management and control – overview
In addition to the Committees shown in the chart, there is a Brand and
Reputation Committee reviewing emerging issues with potentially
significant reputational impact.
These Committees receive regular and comprehensive reports. The
Board Risk Committee receives a quarterly report covering all of our
principal risks. The Board Audit Committee receives quarterly reports on
control issues of significance and half-yearly impairment allowances
and regulatory reports. Both Committees also receive reports dealing in
more depth with specific issues relevant at the time. The proceedings of
both Committees are reported to the full Board, which also receives a
concise quarterly risk report. Internal Audit supports both Committees
by attendance and/or the provision of quarterly reports resulting from
its work on governance, risk and control issues of significance. The
Board Audit Committee reviews and approves Internal Audit’s plans
and resources, and evaluates the effectiveness of Internal Audit.
An assessment by external advisers is also carried out periodically.
Under Basel II, Barclays aims to achieve advanced status under credit
and operational risks. Barclays considers that the investment required
to attain this status is warranted by the internal risk management
improvements that will follow, the reputational benefits and the
potential for greater capital efficiency.
Governance Structure at Group Level
Board oversight Board
Board Audit Committee
ASSURANCE
• Review the Group risk profile.
• Approves the Group Control Framework.
• Approves minimum control requirements
for principal risks.
• Approves overall Group risk appetite.
AUTHORITY
CONTROLS
APPETITE
Board Risk Committee
Assurance Internal Audit
• Assesses the adequacy and effectiveness
of the Group Control Framework.
• Assesses management assurance processes.
REPORTING
Risk adjusted
performance
Group Chief Executive
Group Executive Committee
Governance and Control Committee Treasury Committee
• Reviews the adequacy and effectiveness
of the Group Control Framework.
• Monitors compliance with the
Framework including remediation
of significant control issues.
• Monitors the Group’s liquidity and
maturity mismatch.
• Monitors usage of regulatory capital.
• Reviews policy/controls for liquidity,
maturity transformation and structural
interest rate exposure.
• Approves economic capital allocations.
• Ensures current risk profile is consistent
with Group risk appetite.
• Debates and agrees actions on the risk
profile and risk strategy across
the Group.
• Considers issues escalated by Risk Type
Heads and Business Risk Directors.
• Monitors and manages risk adjusted
performance of businesses.
Risk Oversight Committee
• Considers the adequacy and effectiveness
of the Group Control Framework.
• Reviews reports on control issues of
Group level significance.