Finance is Risky Business: Monitoring and Managing Your Company’s Risk Appetite - Cathy Hauslein, Susser Holdings
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Finance is Risky Business: Monitoring and Managing Your Company’s Risk Appetite - Cathy Hauslein, Susser Holdings

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Cathy Hauslein - Susser Holdings, Speaker at the marcus evans CFO Summit Fall 2011 in Las Vegas, NV, delivered her presentation entitled Finance is Risky Business: Monitoring and Managing Your ...

Cathy Hauslein - Susser Holdings, Speaker at the marcus evans CFO Summit Fall 2011 in Las Vegas, NV, delivered her presentation entitled Finance is Risky Business: Monitoring and Managing Your Company’s Risk Appetite

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Finance is Risky Business: Monitoring and Managing Your Company’s Risk Appetite - Cathy Hauslein, Susser Holdings Finance is Risky Business: Monitoring and Managing Your Company’s Risk Appetite - Cathy Hauslein, Susser Holdings Presentation Transcript

  • Finance Is Risky BusinessManaging Your Company’s Risk AppetiteCathy Hauslein, VP-Controller Susser Holdings Corp. 1
  • What is Risk Management• Risk Management is the process of analyzing exposure to risk and determining how best to handle such exposure.• Enterprise Risk Management (ERM) seeks to strategically consider the interactive effects of various risk events with the goal of balancing an enterprise’s portfolio of risks to be within the stakeholders’ appetite for risk. 2
  • Strategic Risk Management Characteristics1. Alignment with a commitment to ethically create shareholder value – focus on the upside of risk.2. Use of a holistic approach that is broad enough to encompass the spectrum of entity-wide activities needed to achieve an organization’s strategy.3. Approach must be capable of identifying and evaluating events and forces of change – must be a continual, ongoing process. 3 View slide
  • Evaluating Strategic Business Risk1. Understand the entity’s key strategies that are designed to preserve and create stakeholder value.2. Identify the risk-how poorly a strategy will perform if the ‘wrong’ scenario occurs.3. Define an overriding risk management goal-what is the entity’s risk appetite. 4 View slide
  • There is nothing more crucial to the success of ERMefforts in an organization than an informed andsupportive culture. 5
  • Risk Management Process• Context• Risk Assessment – Risk Identification – Risk Analysis – Risk Evaluation• Risk Treatment• Monitoring and Review• Communication and Consultation• Recording the Risk Management Process 6
  • Risk Management Process• Context – The organization-wide risk appetite is formulated and the risk management environment of the organization is defined. – Context looks at the laws, market, economy, culture, regulations, t echnology, natural environment, stakeholders’ needs, issues, and concerns. – Main output of context is the risk criteria to be used to determine the acceptability of risks. 7
  • Risk Management Process• Risk Assessment – Risk Identification – Types of Risks to be Evaluated 8
  • Types of Risk to be Evaluated• Shareholder value risk • Brand risk• Financial reporting risk • Partnering risk• Governance risk • Supply chain risk• Customer and market risk • Employee engagement• Operations risk risk• Innovation risk • R&D risk • Communications risk 9
  • Risk Management Process• Risk Assessment – Risk Analysis – To provide the decision maker with sufficient understanding of the risk that they are satisfied they have sufficient knowledge about the risk to make decisions on risk treatment and acceptance. – Risk Evaluation – Comparing residual risk after risk treatment (Impact) against the risk criteria (Likelihood). 10
  • Risk Evaluation 11
  • Risk Management Process• Risk Treatment – Identification, selection and implementation of control options.• Monitoring and Review – Key to the continuous improvement of risk management. – Key Risk Indicators (KRI’s) • Human Resource • Information Technology • Finance • Legal/Compliance • Audit 12
  • Risk Management Process• Communication and Consultation – Extensive communication among team members and consultations with other experts in the organization.• Recording the Risk Management Process – Provide for traceability of decisions, continuous improvement in risk management, data for other management activities, and legal and regulatory requirements. 13
  • Questions? 14