The Energy & Resources Industry is highly asset-intensive. Organizations who manage these assets are typically confronted with regulatory compliance as well as environmental and safety risks and equipment that is old, maintenance issues, and budget restrictions. All of these issues can potentially have a large impact on an organization’s internal, external and strategic success.
A comprehensive risk management plan is crucial to protect against these risks and ensuring that a company is able to meet the demands of its customers. This article https://expertalmanagement.de/2021/09/01/top-horrible-features-to-avoid-when-buying-a-laptop-for-play-or-work outlines the most important aspects of asset and risk management:
Counterparty risk management is a technique which focuses on ensuring important relationships, like prime brokers, counterparties to derivatives, clearing banks, and custodians, are creditworthy. It also includes failsafe processes designed to guard against reputational or financial damage should these partners fail. This is accomplished by vetting vendors, and ensuring that the approval process doesn’t just apply to the vendor but as well to the services they offer.
Market risk is the chance for a decrease in the value of a portfolio, and it is a common issue that asset managers and risk managers are concerned about, but from slightly different perspectives. Portfolio managers manage their exposures to the market in order to minimize unintended bets on the market and other factors and risk management focuses on managing crowded markets, leverage, liquidity, expected volatility and cash flow.
A solid asset and risk management plan will help a company avoid unexpected problems and maximize the value of its assets. The three-line governance framework is a powerful instrument for identifying and minimizing the risks that can affect the performance of an organization.