Risk management in ASIC

Actively managing risks is an important aspect of ASIC’s governance and accountability framework, and reflects our commitment to enhanced risk maturity. ASIC’s Risk Management Framework is designed to help our staff better manage uncertainty across its diverse activities and operations. To aid our staff in making informed risk management decisions, ASIC has published a Risk Appetite Statement to communicate the Agency’s stance toward risk taking in different areas.

Our risk appetite

ASIC’s Risk Appetite Statement is a reflection of our evolving regulatory environment and strategic focuses. We may choose to adjust our risk appetite posture towards certain types of risk from time to time to achieve our strategic priorities. This reflects the dynamic nature of our regulatory and operational environment, as well as the need for us to be nimble and proactive in our response.

While considered risk taking is both necessary and desirable for ASIC to deliver on its mandate and strategic priorities as Australia’s corporate, markets, financial services and consumer credit regulator, it is critical that we hold ourselves to the highest behavioural standards. As such, ASIC has No Tolerance toward unethical, corrupt or illegal conduct, or behaviours that are inconsistent with the standards expected of ourselves as a regulator and expectations of Parliament and the community.

Being an effective regulator

We have an Enhanced Appetite towards adopting and supporting innovations that may materially contribute to better regulatory outcomes. We also retain a Balanced Appetite to reducing the costs and burdens of regulatory requirements, as long as it will not contribute to systemic or significant harms to consumers, investors and the financial system. In our efforts to achieve better regulatory outcomes, we adopt a Balanced Appetite toward engaging with our various external stakeholders.

Where it is in the public interest to do so, we have an Enhanced Appetite toward exercising our regulatory powers to test their application, including taking tailored and proportionate enforcement action that may prove unsuccessful. In all our undertakings however, we have a Very Limited Appetite toward not exercising our powers correctly and independently.

How we operate

We take a Balanced Appetite toward our key operational activities, and actively invest in mitigations where we have a higher exposure. In doing so we carefully evaluate the cost versus risk mitigation benefit, and actively monitoring our exposures to ensure our mitigations remain effective.

When it comes to our People, we take a Very Limited Appetite toward risks that may harm wellbeing and a Balanced Appetite toward those that may impact the retention and attraction of talent and engagement of staff. We treat our material legal and legislative obligations seriously and have a Very Limited Appetite toward not meeting these obligations and focus on minimising our risk exposure where practically possible.  We have a Very Limited Appetite toward not operating within budget or risks that may impact our ability to collect revenue on behalf of government.

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Last updated: 01/02/2022 11:57