FGV Annual Report 2014

STATEMENT ON RISK MANAGEMENT AND INTERNAL CONTROL The Board remains committed to maintaining a sound system of risk management and internal controls to safeguard shareholders’ investments and FGV Group’s (the Group) assets. This Statement on Risk Management and Internal Control (“Statement”) outlines the Group’s risk management framework and internal control and is intended to provide our stakeholders and users of this Annual Report with meaningful, high-level information about the adequacy and state of the Group’s system of risk management and internal control for the financial year under review. This Statement is made pursuant to Paragraph 15.26(b) of the Bursa Securities Berhad’s Main Market Listing Requirements and in accordance with The Statement on Risk Management and Internal Control: Guidelines for Directors of Listed Issuers (“Guidelines”). Responsibility and Accountability The Board acknowledges its overall responsibility in the establishment and overseeing the Group’s risk management framework and internal control systems. It is committed to ensure the existence of effective risk management framework and internal control systems within the FGV Group and continuously reviews and evaluates the adequacy of these systems. However, the Board recognises that such systems are designed to manage and reduce, rather than eliminate, the risks identified to an acceptable level of risk appetite. As such, the risk management framework and internal controls of the Group are designed to identify the risks and manage such risks within the tolerable level of risk appetite set and approved by the Board. The internal controls implemented can only provide reasonable, but not an absolute, assurance against the risk of failure to achieve the Group’s business objectives and/or occurrence of material financial misstatement or loss. There are three (3) committees at Board level that support the Board in its risk management and internal control responsibilities: i. Board Governance and Risk Management Committee (BGRMC) which is tasked with overseeing risk management and governance aspects of the Group; ii. Audit Committee (AC) which is tasked with assessing the risks and control environments and overseeing financial reporting, including the external and internal audit; and iii. Investment Committee (IC) which is tasked with ensuring investments undertaken are aligned to the Group’s vision and overall risk appetite. These Committees are empowered by clearly established and approved terms of reference in the above mentioned responsibilities. Risk Management FGV has a dedicated Group Risk Management Division (GRMD) which undertakes the following responsibilities: • Reviewing, assessing, enhancing and monitoring the Group’s Risk Management Framework including risk management policies and procedures; • Maintaining the Risk Register for the Group; • Providing guidance to all Group’s operations in identifying and assessing the risks, developing relevant and effective mitigation strategies to manage risks; • Preparing risk reports to BGRMC and the Board; • Undertaking analyses on specific risks and where necessary, reporting the same to BGRMC and the Board; and • Overseeing the Group’s Business Continuity Management. Risk Management Framework and Approach GRMD is supported by Cluster Risk Champions and Risk Champions. The Cluster Risk Champions and Risk Champions are individuals nominated as representatives of the respective Clusters, corporate centres and subsidiaries, to coordinate with the Risk Owners in identifying, evaluating, managing and monitoring their respective key risks. They are also tasked with ensuring the implementation of the action plans to effectively mitigate the risks identified. Felda Global Ventures Holdings Berhad pg 150