It is both our role and our responsibility to serve our customers by managing risks. We rely on a robust and efficient risk management unit that works across all our businesses and the markets and regions in which we operate, and also on a strong risk culture shared by all employees.
All employees must behave like responsible bankers,
measuring and managing the risks they take for their
customers and the bank.
Séverin Cabannes, Deputy Chief Executive Officer
The main objectives of our risk management policy are:
- serving our customers to the best of our ability and contributing to the development of our businesses, guaranteeing the Group’s sustainability by implementing an efficient system for risk analysis, measurement and monitoring
- making risk control a differentiating element and a competitiveness factor recognised by all.
This policy is structured around major risk categories likely to affect our results:
- credit and counterparty risk, in the event that customers or other counterparties become unable to meet their financial commitments
- market risk, such as significant fluctuations in the prices of securities (equities and bonds) or commodities
- operational risk, related to failures in internal procedures, human error or external events
- structural risk: interest rate and exchange rate risk
- liquidity risk, in the event that the Group should find itself unable to meet its cash or collateral requirements as they arise
- compliance risk, including legal, administrative and reputational damage
- country risk, in the event of changing political and economic conditions in the country of operation that negatively impact the Group's interests.
Steering risk management
Implementing a high-performance and efficient risk management structure is a critical undertaking for Societe Generale, in all businesses, markets and regions in which it operates, as is maintaining a balance between strong awareness of risks and promoting innovation. The Group’s risk management, supervised at the highest level, is compliant with the regulations in force.
Specifically, the main objectives of the Group’s risk management strategy are:
- to contribute to the development of the Group’s businesses and profitability by defining the Group’s risk appetite in conjunction with the Finance Division and the business divisions;
- to contribute to the Group’s sustainability by establishing a risk management and monitoring system;
- to reconcile the independence of the risk management system from the business lines with close collaboration with the core businesses, which have primary responsibility for the transactions they initiate.
This can take the form of:
- clear principles for the governance, control and organisation of risks;
- determining and formally defining the Group’s risk appetite;
- effective risk management tools;
- an awareness of risks that is cultivated and established at each level of the company