Goldman Sachs 2012 Annual Report Download - page 81

Management’s Discussion and Analysis
‰Firmwide New Activity Committee. The Firmwide
New Activity Committee is responsible for reviewing new
activities and for establishing a process to identify and
review previously approved activities that are significant
and that have changed in complexity and/or structure or
present different reputational and suitability concerns
over time to consider whether these activities remain
appropriate. This committee is co-chaired by the firm’s
head of operations/chief operating officer for Europe,
Middle East and Africa and the chief administrative
officer of our Investment Management Division who are
appointed by the Firmwide Client and Business Standards
Committee chairperson.
‰Firmwide Suitability Committee. The Firmwide
Suitability Committee is responsible for setting standards
and policies for product, transaction and client suitability
and providing a forum for consistency across divisions,
regions and products on suitability assessments. This
committee also reviews suitability matters escalated from
other firm committees. This committee is co-chaired by
the firm’s international general counsel and the co-head
of our Investment Management Division who are
appointed by the Firmwide Client and Business Standards
Committee chairperson.
Firmwide Risk Committee. The Firmwide Risk
Committee is globally responsible for the ongoing
monitoring and control of the firm’s financial risks.
Through both direct and delegated authority, the Firmwide
Risk Committee approves firmwide, product, divisional
and business-level limits for both market and credit risks,
approves sovereign credit risk limits and reviews results of
stress tests and scenario analyses. This committee is co-
chaired by the firm’s chief financial officer and a senior
managing director from the firm’s executive office, and
reports to the Management Committee. The following four
committees report to the Firmwide Risk Committee. The
chairperson of the Securities Division Risk Committee is
appointed by the chairpersons of the Firmwide Risk
Committee; the chairpersons of the Credit Policy and
Firmwide Operational Risk Committees are appointed by
the firm’s chief risk officer; and the chairpersons of the
Firmwide Finance Committee are appointed by the
Firmwide Risk Committee.
‰Securities Division Risk Committee. The Securities
Division Risk Committee sets market risk limits, subject
to overall firmwide risk limits, for the Securities Division
based on a number of risk measures, including but not
limited to VaR, stress tests, scenario analyses and balance
sheet levels. This committee is chaired by the chief risk
officer of our Securities Division.
‰Credit Policy Committee. The Credit Policy Committee
establishes and reviews broad firmwide credit policies
and parameters that are implemented by our Credit Risk
Management department (Credit Risk Management).
This committee is chaired by the firm’s chief credit officer.
‰Firmwide Operational Risk Committee. The
Firmwide Operational Risk Committee provides
oversight of the ongoing development and
implementation of our operational risk policies,
framework and methodologies, and monitors the
effectiveness of operational risk management. This
committee is chaired by a managing director in Credit
Risk Management.
‰Firmwide Finance Committee. The Firmwide Finance
Committee has oversight of firmwide liquidity, the size
and composition of our balance sheet and capital base,
and our credit ratings. This committee regularly reviews
and discusses our liquidity, balance sheet, funding
position and capitalization in the context of current
events, risks and exposures, and regulatory requirements.
This committee is also responsible for reviewing and
approving balance sheet limits and the size of our GCE.
This committee is co-chaired by the firm’s chief financial
officer and the firm’s global treasurer.
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