Module 11 - Stakeholders

Question 1

List the 5 key stakeholders

Answer 1

Principal - contribute capital and expect returns e.g customers
Agency - paid by principal for specific role e.g employees
Controlling - Supervise principals and agents e.g regulators
Advisory - advise principals and agents e.g shareholder service providers
Incidental - affected by principals and agents’ actions e.g
Suppliers and creditors

Question 2

What are the four main concerns raised over Shareholder service providers

Answer 2

Ticking the box syndrome
Conflict of interest
No interest in the outcome

Question 3

How to have a successful business alliance

Answer 3

Form alliance if best option
Monitor the alliance in early stages against goals but don’t be over zealous
Find the best alliance partner by ranking all possible partners.

Question 4

What are the key functions of the CRO (10)

Answer 4

Developing and supporting a risk culture of the business
Overseeing the various risk functions of different departments
Reporting on risk internally and externally
Data systems and models for analysing, managing and monitoring, measuring risk
Leadership and direction of an ERM function
Implementing the ERM function through the organisation
Managing and optimising risk portfolio
Risk policy dev, and monitoring adherence to policies
Economic capital allocation to biz activities
Safeguard financial assets of a co
Maintaining risk expertise and and advising risk management matters