Risk Management
Risk Management Policy
Through the establishment of an appropriate risk management structure, guidelines, controls, and risk reporting systems, as well as a sound risk management culture, SinoPac Holdings integrates and manages related risks, timely reviews the revised management mechanisms or measures, and fully formulates risk-related regulations and limits to prevent the occurrence of significant risk events and to achieve the best balance between profitability and risk management.
SinoPac Holdings formulated the "Risk Management Policy" , which was approved by the Board of Directors in 2009. In addition to development of a risk management environment and culture for each subsidiary, the Policy defines the integrated management regulations and limits for various risks, the authority and operating guidelines for business units and other risk management procedures to identify, measure, assess, and manage risks. SinoPac Holdings also conducted risk assessments and created risk response measures for credit, market, operation, asset and liability, reputation, legal, compliance, strategy risks, and other risks associated with business operations including emerging risk, climate change risk and nature-related risk. They are used to identify the related risks at the group level and formulate response measures to be reported to suitable management levels. The risk management unit or personnel of SinoPac Holdings and its subsidiaries are required to regularly report risk management status and improvement recommendations to the Board of Directors. In the event of material risk exposure, suitable actions shall be taken immediately and reported to the Board of Directors.
The Risk Management Division of SinoPac Holdings reports to the Board of Directors monthly and to the Risk Management Committee quarterly on the implementation of risk management and recommendations for improvement. The overall status of the Company's management of existing or potential risks or climate change risks (including physical risks and transition risk indicators) and the progress of related projects are also reported to the Audit Committee on a quarterly basis.
SinoPac Holdings Risk Management Mechanisms
SinoPac Holdings Risk Management Procedures
Risk Management Organizational Framework
To effectively manage the risks arising from the operations of SinoPac Holdings and its subsidiaries, the Board of Directors serves as the highest authority for risk oversight. In addition to approving risk management policies and risk appetite or limits, the Board delegates the responsibility of day-to-day risk management to the management team. Based on its authority, the management should supervise risk management activities, evaluate the performance of risk management, and make sure that each risk management officer works professionally and in line with the code of ethics.
The Audit Committee is composed of three Independent Directors. They assist in supervising the effective implementation of the internal control system of SinoPac Holdings, compliance with laws and regulations, controlling existing or potential risks, and assisting the Board of Directors in making decisions with its professional division of labor and independence. Its duties include receiving regular reports from the Risk Management Division on potential risks and their management, supervising the implementation of risk management by the Company and subsidiaries, and deliberating the Company's risk management policies.
The Risk Management Committee has been set up under the Chairman, who serves as the convener of the committee, to be in charge of deliberating on the risk management policy, organization, system, and risk limit, reviewing overall risks, supervising risk management activities of SinoPac Holdings and its subsidiaries, coordinating efforts to manage significant risk events, and deliberating on other issues related to risk management.
The Risk Management Division has been set up under the President to coordinate the formulation of overall risk management policies and standards as well as the establishment and planning of risk management systems for the Company and its subsidiaries. The Risk Management Division is responsible for promoting the policies, standards, and systems after they have been approved by the Board of Directors, and periodically evaluates the implementation results and management performance of each subsidiary.
Based on its authority, the management assigns a controlling unit or personnel to be responsible for the risk management of its business to ensure that all risks are properly monitored.
Risk Management Organizational Structure of SinoPac Holdings
