Barclays 2015 Annual Report Download - page 133

home.barclays/annualreport Barclays PLC Annual Report 2015 I 131
Principal and Key Risks
Principal Risks comprise individual Key Risks to allow for more granular
analysis. As at 31 December 2015, the five Principal Risks were: i) Credit;
ii) Market; iii) Funding; iv) Operational; and v) Conduct. Since the
beginning of 2015, Reputation Risk has been recognised as a Key Risk
within Conduct Risk given their close alignment and the fact that as
separate Principal Risks they had a common Principal Risk Officer.
Risk management responsibilities for Principal and Key Risks are set out
in the ERMF. The ERMF creates clear ownership and accountability;
ensures the Group’s most significant risk exposures are understood and
managed in accordance with agreed risk appetite and risk tolerances;
and ensures regular reporting of risk exposures and control
effectiveness.
For each Key Risk, the Key Risk Officer is responsible for developing a risk
appetite statement and overseeing and managing the risk in line with
the ERMF. This includes the documentation, communication and
maintenance of a Key Risk Control Framework which sets out, for every
business across the firm, the mandated control requirements in
managing exposures to that Key Risk. These control requirements are
given further specification, according to the business or risk type, to
provide a complete and appropriate system of internal control.
Business and Function Heads are responsible for obtaining ongoing
assurance that the key controls they have put in place to manage the
risks to their business objectives are operating effectively. Reviews are
undertaken on a six-monthly basis and support the regulatory
requirement for the Group to make an annual statement about its
system of internal controls. At the business level, executive management
hold specific Business Risk Oversight Meetings to monitor all Principal
Risks.
Key Risk Officers report their assessments of the risk exposure and
control effectiveness to Group-level oversight committees and their
assessments form the basis of the reports that go to the:
Board Risk Committee:
 Financial Risk Committee has oversight of Credit and Market Risks
 Treasury Committee has oversight of Funding Risk
 Operational Risk Review Forum has oversight of the risk profile of all
Operational Risk types.
Board Reputation Committee:
 Conduct and Reputation Risk Committee has oversight of Conduct
and Reputation Risks.
The following sections provide an overview of each of the five Principal
Risks, and details of the structure and organisation of the relevant
management function and its roles and responsibilities, including how
the impact of the risk to the Group may be minimised.
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