Risk Management

Types of risk

In practice, Risk Management mainly concerns itself with the following risks:

• Market risk: the risk from fluctuations on real estate markets and financial markets (interest rate, currency, capital, etc.)
• Credit risk: the risk that a counterparty cannot meet its financial obligations
• Operational risk: the risk of losses due to inadequate or failing internal processes, human behaviour or systems, or due to external circumstances. Information security and insurance risks also form part of operational risk management
• Compliance risk: the risk of actions that are not in line with prevailing legislation, regulations, instructions and prescribed procedures, both internally and externally
• Reputation and integrity risk: risks caused by negative publicity or public opinion as a consequence of activities and behaviour by the organisation or its employees (direct risk) or of activities or behaviour of business associates (indirect risk).

Objectives of Risk Management

• Uniform attitude and knowledge: to ensure that there is a uniform attitude to risk management at Bouwfonds REIM and that more and more knowledge is acquired about the management of risk.

• Assessment of return versus risk: to encourage staff to put the risk-return ratio at the heart of their business activities.

• Management commitment: to ensure that management takes every measure at every level to identify, establish and manage risks.

• Transparency: to achieve optimum transparency in the assessment of risks with clear and corresponding management information

• Partnership between commercial activities and risk management: to achieve practical workable governance for risk management with good cooperation between RM and those responsible for commercial activities

• Being compliant with external legislation: to facilitate all the processes required to comply with internal and external risk management regulations and legislation