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Role of the Board
The Board is responsible for overseeing an issuer's risk management and its internal controls.

An issuer’s business always involves risks. An issuer therefore needs to have an appropriate framework and systems to manage such risks. This helps to prevent regulatory exposure, and, at the same time, supports the issuer’s pursuit of its corporate values and strategic goals. The Board has to ensure that a culture and a control environment exists where risks are appropriately assessed and addressed.

Identification of Risk

The risks that each issuer encounters will be different, depending on the scale, complexity and geographical locations of its business operations. To take appropriate steps to identify all relevant risks, an issuer may undertake the following steps:

  • Analyse the source of potential internal and external risks that may arise in relation to the issuer’s business, e.g. cyber security, regulatory, ESG and labour risks.
  • Evaluate and prioritise the potential risks through discussions within the issuer’s management.
  • Create a risk register which is populated with key strategic risks, i.e. risks that may prevent the issuer from achieving its strategic objectives. The risk register should be a record of all the risks that the issuer faces and it should be reviewed and updated regularly, at least annually.

Risk Heat Map
A tool for the Board’s risks assessment is a matrix in the form of a “heat map”. In the “heat map”, there should be a list of the issuer’s top 10 to 20 risks based on which the Board can consider and review the internal control systems to mitigate such risks.


Our Guidance Materials
The Exchange has developed training and published comprehensive guidance materials on risk management and internal controls. External resources provide additional guidance on these subjects.

Publication and Training
External Resources