The current economic context of globalisation and increased competition makes it necessary for a company to adapt permanently to its environment. Risk-taking is therefore becoming a major challenge in development. That is why an increasing number of organisations now have mechanisms and processes to control risk, whilst ensuring that they achieve their objectives and improve their performance.
Concrete implementation of this approach covers the fields of governance, risk management, internal control and compliance with laws, regulations and other references.
Risk control: how best to anticipate and manage uncertainty?
- Develop and diffuse values that guarantee the integration of risk management into corporate culture
- Define the management, supervision and risk steering strategy
- Draw up and implement the organisation, processes and tools for risk management
- Draw up risk mapping and management developments over time
- Design and implement a process for prevention of fraud risk
Headlink works with its clients in the definition of their objectives in terms of risk management with the resulting roadmap, creation of risk mapping, design and deployment of the reporting and risk steering mechanism and, above all, articulation between risk management and the decision-making processes (investments, project management).
Internal control mechanism
- Optimising the organisation's internal control and improving control of operations and performance
- Aligning the internal control mechanism with the organisation's governance challenges and risks
- Optimising internal control mechanisms linked to financial and operational risks in order to reduce their cost
- Moving from internal control managed in project mode to internal control integrated into the ways the organisation functions.
Headlink steers implementation of a continuous improvement process, which reflects the objectives of its clients and the challenges they face and takes their risks into consideration by establishing an efficient internal control process which represents a workload adapted to the organisation.
- Creating risk mapping linked to laws and regulations
- Ensuring that the organisation complies with the laws, regulations and references pertaining to its business
- Managing the changes caused by the diffusion of new practices and procedures within the organisation
- Creating and developing a Compliance function within the organisation
- Optimising the compliance mechanism
In the image of the banking sector, the insurance and social cover sector has now entered a new phase of regulation with the arrival of the European directive Solvency 2 which will come into force at the beginning of 2013. This means that insurance companies will have to:
Meet the new minimum capital requirements (MCR) and solvency capital requirements (SCR) (Pillar 1 of the reform)
Have an internal control mechanism (Pillar 2)
Provide national control authorities with an annual quantitative and qualitative report (report, ORSA) of all their risks (policy risk, market risk, credit risk, operational risks) (Pillar 3)
At the heart of the reform, Pillar 2 underlines the "Internal Control" function which has not only become a major concern for supervisors and regulators over the course of the past 20 years, but also for the markets, for investors, ranking agencies and customers. In the current crisis context, risk control and process security play a still greater part in the improvement of a company's internal performance. Internal control mechanisms must also be accompanied by an efficient governance system, integrating at least four key functions (actuaries, risk management, compliance, internal audit).
Headlink works with its clients in the operational adaptation of the Solvency 2 regulation, the implementation or reinforcement of internal control mechanisms, the definition of efficient governance, the setting up of a permanent compliance function and the implementation of ORSA reports and calculations.
A few references:
Within the context of certification of a major real estate finance group, work on the adjustment and optimisation of its procedures for the management of guarantees received and incidents for the adoption of a new Group mechanism for the management of Basel-defaulting and bad debts.
Within a major investment bank, set-up of a counterpart risk management tool through the deployment of new methods for assessing delivery risk and issue risk.
Within the context of an audit of the Basel II reporting system, diagnosis of directions for improvement and levers for optimisation to ensure that reporting is more efficient and to industrialise indicator tracking.
Within a major French health insurance company, establishment of the internal control mechanism, formalisation of processes, creation of risk mapping, implementation of control action plans, training of managers.
In an international insurance group, diagnosis of regulations, structuring of the Solvency 2 programme, implementation of project governance.
In a Life Insurance company, Solvency 2 diagnosis, creation of the Internal Control Division, establishment of the internal control mechanism, deployment of the Risks culture.