FGV Annual Report 2018

96 REINFORCED OUR STANDARDS OF GOVERNANCE FGV HOLDINGS BERHAD In 2018, there were several key achievements brought about through the accomplishment of risk management activities and/or initiatives by Group Risk Management Division (GRMD) within FGV Holdings Berhad (FGV or the Group). Among others, the key highlights are as follows: GRMD received two awards namely: RISK MANAGEMENT TEAM OF THE YEAR 2018 AWARD GRMD won the 1 st runner up award from Malaysian Association of Risk and Insurance Management (MARIM) in recognition of effective implementation of risk management strategies. MALAYSIA ENTERPRISE INNOVATION AWARD 2018 The award was received from Asia IOT Business Platform for the implementation of the Enterprise Risk Management (ERM) system as an innovative tool to improve the Group’s capabilities in proactive management of risks. Enhancement of the risk assessment process has entailed in revamping the Project Risk Assessment template which aims to embed risk management approach into business decision making. GRMD assisted the business by facilitating risk assessments of various business proposals and projects by applying sound methodology in dimensioning and quantifying the relevant project or business risks. Implemented Risk Appetite Statement (RAS) for the Upstream Cluster and addition of five new key risk drivers into Group RAS to strengthen the measure of the risk profiles by using relevant key risk indicators aligned with business objectives and strategies of FGV. A newly introduced Scenario Analysis exercise was aimed at analysing potential risk exposures arising from a prolonged decline in Crude Palm Oil (CPO) price, severe adverse weather and economic crash. The outcome of the exercise was to prepare FGV with appropriate mitigation strategies to address the risks associated with the scenarios. Initiatives under the Governance Quantum Leap project were put in place to improve the corporate governance and business controls within FGV. Among others, primary achievements attained throughout the initiatives were as follows: • Revision to the existing Policies and Procedures for Receivables and Credit Management under Finance. • Review of the Discretionary Authority Limits. • Improvements made to the Delima Oil Product Sdn. Bhd.’s credit control environment. • Tightening of the Whistleblowing, Procurement & Tender Policies and other identified Policies and Procedures. • Strengthening of the Board oversight roles. Various initiatives were undertaken by GRMD to complete the roadmap under the Risk Management Framework (RMF) . The accomplishment of the roadmap was to ensure alignment with the Group’s risk management culture, processes, practices, structures and decision making. Inaugural Location Based Crisis Management (LBCM) exercise was simulated at Bandar Sahabat, Sabah involving participation of eight companies under FGV and six local authority bodies. The scenario was based on a fire incident that has spread from a factory. The aim of the exercise was to inculcate greater awareness on Business Continuity Management (BCM), identify the areas for improvements and strengthen the interdependencies among various recovery plans namely business continuity, emergency response, crisis communication as well as disaster recovery plans to minimise the impact of a crisis. STATEMENT ON RISK MANAGEMENT AND INTERNAL CONTROL