OUR BUSINESS:
Risk and Opportunity management
Key risks in 2023/24, treatment, opportunities, trend and outlook
Legend
Risk severity |
Risk appetite |
Risk movement |
||||||
|---|---|---|---|---|---|---|---|---|
| Low Risk | Medium Risk | High Risk | Within risk appetite | Exceeds RA but within tolerance limit | Exceeds tolerance limit | Risk is likely to increase | Risk is likely to reduce | Risk is not likely to change |
Risk, treatment and the outlook
Risk severity
Risk appetite
Outlook
Risk and mitigation
Operational risk is the risk of loss arising from inadequate or failed internal processes, people, and systems, or external events. To mitigate this risk, we have automated most of our processes and we ensure that our systems are robust.
Risk outlook
This risk is likely to decrease or stabilise as automation becomes more integrated into the Fund.
Opportunity
Operational risk assessment helps identify and address process weaknesses proactively.
Capitals Impacted
Stakeholders Impacted
Material Matters
Strategic Objectives Impacted
Risk severity
Risk appetite
Outlook
Risk and mitigation
Technology risks result in system malfunctions, which impact the operations of the Fund. We resolve system malfunctions by analysing root causes and implementing patches or reconfigurations to ensure reliability.
Risk outlook
This risk is expected to decrease with the implementation of a real-time monitoring tool that detects malfunctions and recommends corrective actions.
Opportunity
The tool will help to reduce system downtime and enhance operational efficiency.
Capitals Impacted
Stakeholders Impacted
Material Matters
Strategic Objectives Impacted
Risk, treatment and the outlook
Risk severity
Risk appetite
Outlook
Risk and mitigation
Despite the inherent high risk of financial crime, the Fund has robust internal control systems in place.
Risk outlook
We expect this risk to rise as criminals use more sophisticated technology. To counter this, we've strengthened our cybersecurity measures.
Opportunity
In the rare event of a financial crime incident, it provides an opportunity to review and strengthen the affected controls.
Capitals Impacted
Stakeholders Impacted
Material Matters
Strategic Objectives Impacted
Risk severity
Risk appetite
Outlook
Risk and mitigation
Governance risk increased due to litigation over Mr. Patrick Ayota's appointment as Managing Director. However, the Fund successfully defended his appointment in court, affirming his lawful status.
Risk outlook
The Board's term ends in August 2024. Any delay in appointing a new Board could create a governance gap. The Fund has informed the Minister to begin the appointment process.
Opportunity
The new Board will be crucial in guiding the Fund as it embarks on its strategic journey towards 2035.
Capitals Impacted
Stakeholders Impacted
Material Matters
Strategic Objectives Impacted
Risk severity
Risk appetite
Outlook
Risk and mitigation
Liquidity risk was rated low, as the Fund enjoyed a strong liquidity position, as indicated by a net positive position of cash and cash equivalents as at 30/06/2024- Refer to the statement of cash flows in the AFS.
Risk outlook
We do not anticipate an increase in liquidity risk, given the strength of our cash flow position.
Opportunity
A strong liquidity position allows the Fund to seize investment opportunities.
Capitals Impacted
Stakeholders Impacted
Material Matters
Strategic Objectives Impacted
Risk severity
Risk appetite
Outlook
Risk and mitigation
Negative press from regulatory reviews and litigation over Mr. Patrick Ayota's appointment initially harmed the Fund's image at the start of FY 2023/24. However, following the dismissal of the case, the Fund restored its credibility, as reflected in a rise in positive media coverage.
Risk outlook
The expectation gap (i.e. The difference between the Fund’s legal mandate and public expectations), frequently leads to negative perceptions
Opportunity
The new stakeholder engagement framework enables the Fund to improve public engagement, bridging the expectation gap and addressing concerns more effectively.
Capitals Impacted
Stakeholders Impacted
Material Matters
Strategic Objectives Impacted
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