Home FCA Handbook MIFIDPRU MIFIDPRU 8 MIFIDPRU 8.2 Risk management objectives and policies
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MIFIDPRU 8.2 Risk management objectives and policies

01/01/2022R

A firm must disclose its risk management objectives and policies for the categories of risk addressed by:

  1. (1)

    MIFIDPRU 4 (Own funds requirements);

  2. (2)

    MIFIDPRU 5 (Concentration risk); and

  3. (3)

    MIFIDPRU 6 (Liquidity).

01/01/2022R

The risk management objectives and policies for each of the items listed in MIFIDPRU 8.2.1R must include:

  1. (1)

    a concise statement approved by the firm’s governing body describing the potential for harm associated with the business strategy; and

  2. (2)

    a summary of the strategies and processes used to manage each of the categories of risk listed in MIFIDPRU 8.2.1R and how this helps to reduce the potential for harm.

01/01/2022G

In complying with MIFIDPRU 8.2.2R, a firm may consider that information drawn from the ICARA process is a relevant and useful way of disclosing:

  1. (1)

    the firm’s approach to risk management by reference to its risk management policies;

  2. (2)

    details of the firm’s risk management structure and operations, for example, the senior management responsible for each area of risk (where applicable), and any relevant committees and their responsibilities;

  3. (3)

    how the firm sets its risk appetite; and

  4. (4)

    a summary of how the firm assesses the effectiveness of its risk management processes.