The Energy & Resources Industry is heavily dependent on assets. Companies that manage these assets are frequently faced by regulatory compliance security and environmental threats and equipment that is old, maintenance issues, and budget limits. All of these issues could have an impact on the operational, external and strategic performance of an organization.
A comprehensive risk management plan is essential to guard https://expertalmanagement.de/ against these risks and ensuring that a company can continue to meet the demands of its customers. This article provides a list of the most important areas of risk and asset management:
Counterparty risk management is a technique that focuses on making sure key relationships, such as prime brokers and counterparties to derivatives, clearing banks, and custodians are creditworthy. It also includes failsafe processes that are designed to safeguard against financial losses or reputational damage should the partners fail. This is done through vetting vendors, and ensuring the approval process doesn’t just apply to the vendor but also the service they provide.
Market risk is the possibility of a decline in the value of a portfolio. Asset managers as well as risk management are worried about it, but from slightly differing perspectives. Portfolio managers manage their exposures to the market to limit unintentional betting on markets and other elements that affect risk management, while asset management focuses on tackling crowded trades, liquidity, leverage, expected volatility and cash flow.
A sound asset and risk management plan will help an organization avoid unexpected problems and maximize the impact of its assets. The three-line governance framework is a useful tool for identifying and minimizing the risks that could impact the performance of an organization.