OVERSIGHT

Oversight is needed to make sure a firm and all its moving parts function and work as expected, detailed under Senior Management Arrangements, Systems and Controls.  For most firms this is about making sure that there are appropriate systems and controls in place to give comfort and management information to prove that the firm and all the moving parts are working.  In essence this therefore allows management to know what is going on and is going on as expected.  The failure to have the appropriate oversight in place gives rise to operational risk and therefore conduct risk and could lead to a firm receiving a FCA Section 166 – lack of oversight and control.

 

What Governance Connect would help a firm with:

 

  • Systems and Controls in place to deliver compliant financial products

  • Boards and senior management have appropriate management information and act on it

  • Risk Identification based on adequate (understood) MI

  • Committees, Terms of References & Action logs

  • Segregation of duties - no one person can commit the firm to a negative outcome without anyone knowing

  • Process and procedures documented and followed

 

Therefore

 

  • Fund Governance allows Asset Managers to meet their obligations by ensuring

    • Funds are run by investment managers of appropriate standing and expertise;

    • The risks of any new fund are identified and can be effectively controlled;

    • Investors are aware and understand the risks of investing in individual funds;

    • Committees and functions are established to provide an additional level of oversight and control

 

  • Risk monitoring

    • Develop a list of key risk indicators for a risk committee

    • Track and report on incidents and complaints

    • Define and implement risk & control reporting

 

  • Asset Management Oversight

    • Operations

    • Compliance and Regulatory observance

    • Risk Management

    • Investment Performance and Investment Risk

 

For further information on the importance of Oversight please click on that link.

Remember that by the time a crisis strikes, it is too late to start preparing for it

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