Enterprise Risk Management Framework
Recognising the importance of effective risk management in enhancing corporate governance and strategic planning, NEA has established an Enterprise Risk Management (ERM) framework to manage risks and opportunities in a structured, integrated and effective manner.
The ERM framework enables NEA to proactively identify, assess, prioritise, treat and monitor our key strategic and operational risks on an ongoing basis. It enhances:
- Risk Awareness, by providing an integrated view of the combined impact of different risks on the organisation, thereby eliminating silo thinking in risk management
- Risk Ownership, by providing a formalised structure to assign accountability for key risks, mitigating measures and treatment plans
- Proactive Risk Management, by providing a structured and robust management process to minimise upstream risks, based on both top-down and bottom-up risk reviews
NEA takes a precautionary approach to managing our risks and closely monitors them, as well as identifies new risks and opportunities. This is to ensure that NEA’s corporate sustainability efforts address all developing trends and risks.
In planning ERM activities, NEA is guided by an ERM framework that features three thrusts:
The Enterprise Risk and Safety Steering Committee (ERSSC) is responsible for driving overall ERM efforts in NEA, and comprises representatives across NEA. It is chaired by the Deputy CEO (Planning, Corporate and Technology) in his capacity as NEA’s Chief Risk Officer.
The ERSSC meets four times a year, and reviews key strategic and operational risks faced by NEA. The ERSSC also reviews the effectiveness of these risk treatment plans to ensure key risks are adequately addressed, as well as studies trends and emerging issues that may impact the risks confronting NEA.
The ERSSC updates the CEO, Audit Committee and Board on strategic risks which NEA faces. Risk Work Groups are formed to comprehensively cover our work scope, aligned with NEA's structure and strategy map. Risk Owners are assigned the task of identifying, assessing, and monitoring key strategic and operational risks, and treatment plans to mitigate those risks. As part of the risk management process, environmental scans are conducted on material issues that may impact the achievement of strategic objectives in the strategy map. Meanwhile, Process Owners provide risk content such as root causes, consequences and controls, as well as implement and monitor the risk treatment plans.
The materiality assessment, which is part of NEA's ERM framework, enables us to identify and assess our environment, social and governance risks, challenges and opportunities.