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. Our risk appetite is determined by our ethos of mutuality and our commitment to operating efficiently and ethically within legislative parameters to achieve our 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. Our methods for identifying risk include monitoring the external environment and industry trends; conducting risk analysis workshops and interviews; analysing various scenarios, data and assumptions; and performing reviews. Identified risks are evaluated for likelihood, consequence and velocity, considering the effectiveness of existing controls. All these factors are combined to determine residual risk, which is assessed against our approved risk appetite. Reasonably foreseeable, emerging and relevant material risks are reported in various risk registers. These include current and emerging risks and consider our long-term strategic targets as well as our appetite for each category of risk. Mitigation plans and existing controls are articulated and measured for all risks. Our process of identifying and managing risks typically includes and facilitates: • discussions on how emerging risk scenarios might impact business strategy; • consideration of key trends and developments in the insurance and wider financial services industry and how these could impact PPS in the future; and • reviewing the emerging risks being experienced by other insurers and/or similar financial services institutions. PPS Integrated Report 2021 Material matters and risk management | 80
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