[October 2015]

 

 

 

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中文版

Risk management in the Hong Kong and China market

Written by: Ms. Cecilia Zhou - Risk Consultant

As a growing number of enterprises are listed or looking to be listed in Hong Kong, boards of directors are required to review and report on the adequacy of risk management processes in the organizations they administer. From this perspective, boards will increasingly need the practical and effective implementation of risk management services. HKICS therefore conducted a survey together with an accounting firm called “Risk Management – Looking at the new normal in Hong Kong”. The survey is about the perception of the value and significance of the risk management, assessing the awareness and readiness of the management to manage and oversee risks in the rapidly changing business environment. The survey gathered data from 279 respondents from a range of industries, including financial services, industrial and manufacturing, and real estate and infrastructure. Now this newsletter will help you understand the key findings in this report and think about “new normal” risk management.

The key findings:

  • 91% of executives thought that risk management could add value and help improve the way they did business, yet only 66% built it into planning decisions;

  • 57% of respondents cited difficulties understanding enterprise-wide risk exposures, and 61% indicated the need for better board and senior management team awareness.

  • 90% said their boards discussed risks for key decisions, but only 43% treated it as a standing agenda item.

  • Only 36% of respondents have developed a formal risk appetite statement.

  • 29% of respondents said there was no process at their company to aggregate risks facing the business.

  • Less than half (42%) believed the organization was effective in developing stakeholders’ knowledge of the risk program.

  • 61% said there was a weak link between risk management and compensation.

  • Only 43% of respondents believed they had an internal audit (IA) function whose audits could be clearly linked back to the top risks facing the organization. Furthermore, 15% of organizations did not have an IA function in place.

From the highlighted findings, it’s obvious that risk management is increasingly seen as a high priority among the companies surveyed. Nowadays, external emerging risks, investor activism and board focus on risk, and changing regulatory requirements are the development trends in the Hong Kong market, which have put risk management in the spotlight.


If there are any aspects which we may assist, please do not hesitate to contact:

Partner in charge - Mr. Roy Lo
roy.lo@shinewing.hk (Tel. 3583 8048) or

Senior Risk Manager - Ms. Gloria So
gloria.so@shinewing.hk (Tel. 3583 8517)

 

SHINEWING Risk Services Limited

Contact Us

SHINEWING Risk Services Limited
43/F., Lee Garden One, 33 Hysan Avenue Causeway Bay, Hong Kong,

T. (852) 3583 8000

F. (852) 3583 8532

W. www.shinewing.hk

E. risk@shinewing.hk

 

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About SHINEWING Risk

SHINEWING Risk Services Limited is an industry leader with many years of experience in risk management and internal control review services in China and Hong Kong. SHINEWING has maintained its leadership position in the market over the years.

Headquartered in Beijing and with branch offices in Hong Kong, Singapore, Japan and Australia, Shenzhen, Chengdu, Shanghai, Xi’an, Tianjin, Qingdao, Changsha, Changchun, Yinchuan, Jinan, Dalian, Kunming, Guangzhou, Fuzhou, Nanjing, Urumqi, Wuhan, Hangzhou, Taiyuan, Chongqing and Nanning. SHINEWING is ideally positioned to provide services for our valued clients.

 

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