2019 Integrated Report

RISK MANAGEMENT PPS takes care of the financial interests of its members by providing advice, products and services to create, protect and manage their wealth. The Group’s risk appetite is determined by its ethos of mutuality and its responsibility to operate efficiently and ethically within legislative parameters to achieve its mandate. PPS risk management – an iterative process applied at strategic, operational and project levels – is integrated throughout all PPS activities. Risks are identified by ascertaining the causes and sources of events, situations or circumstances that could materially impact the group, either positively or negatively. Methods for identifying risk include monitoring the external environment and industry trends; conducting risk analysis workshops; interviews and analysing various scenarios, data and assumptions, and audits. Risks identified in terms of PPS’s risk management criteria are evaluated for likelihood, consequence and velocity, taking into account the effectiveness of existing controls. All of these factors are combined in order to determine residual risk, which is assessed against PPS’s approved risk appetite. Reasonably foreseeable, emerging and relevant material risks for the Group are reported in various risk registers. These include current and emerging risks and take into account the Group’s long-term strategic targets as well as its risk appetite for each type of risk. Mitigation plans and existing controls are articulated and measured for all risks. Medical science is continuously learning as the pandemic grows and experience is gained. PPS will therefore monitor progress and adapt our risk mitigations accordingly with the objective to ensure safe and healthy working environments for PPS employees, and to ensure business continuity for our members, staff and other stakeholders. PPS’s response With such external challenges, PPS strives to treat all its members fairly and equitably, and for this purpose we have to rely on the best relevant expertise available. Given that this is a unique and unusual situation, where we cannot rely on previous experience, we and other stakeholders will constantly grow our understanding of this situation and our response as insurers and therefore our risk mitigations will continue to evolve. A PPS Group Epidemic Management Policy has been developed and implemented and sets out the Group’s response to the management of epidemics. This policy applies in conjunction with the Business Continuity Plan (BCP). As the level of risk associated with the pandemic reaches the predefined levels as indicated in the policy, the appropriate responses as governed by the BCP are followed. REGULATORY ISSUES Defining the issue As a financial institution, PPS complies with all laws and regulations governing the industry. There should be a balance, however, between protecting customers, the stability of the financial system and onerous legislative requirements that are constantly changing. PPS’s response After extensive research and analysis, PPS has developed its own complete ORSA (Own Risk and Solvency Assessment), demonstrating that the Group is prudently managed. 50 | PPS INTEGRATED REPORT 2019