“What’s different about PartnerRe is that risk management is integrated. Everybody is responsible for the risk they assume but they’re supported by teams of professionals who focus exclusively on risk management. That combination enables a more thorough understanding of the risks we assume; ultimately, we find the right balance between risk and reward.”
“Overarching all that we do are the key principles and policy statements that are linked to our top risks – each one is picked up and reiterated at a more granular level in more specific policies in different parts of the organization.”
Good governance
Effective risk management requires a sound governance structure and a clear set of principles and policies that apply across the organization. PartnerRe’s organizational structure is designed for effective and efficient management of the Company’s risks, with a balance between centralized control and decentralized management in the business units. The business unit structure also provides clarity around risk ownership: each assumed risk has one entry-point into the Company.
Executive Management and the Board are responsible for setting our vision and goals, including overall risk appetite and return expectations (ROE target). Strategy and principles are recommended by Executive Management and approved by the full Board.
There is a policy or set of policies to manage every risk that we can control, with Group policy statements and key Group policies established by the CEO, and Business Unit/Group Function policies at the next level. Risk management policies and processes are maintained by management, audited by Internal Audit and the results of audits are monitored by the Board’s Audit Committee. Over-arching all of our daily actions, across the organization, is the Code of Business Conduct and Ethics.
Good governance is critical for stability because it provides the safeguards that allow us to optimize the balance between risk and return. We can set our volatility appetite moderately above the market, creating greater shareholder value, because we know we have the necessary controls in place to protect the Company from the downside risk that could impair our balance sheet.
Our industry and markets change and evolve, so governance cannot be static. Management is constantly reviewing and refining PartnerRe’s approach. In 2008, the focus was on Integrated Risk Management and in particular further aligning and integrating the existing risk management processes of the Capital Markets and Reinsurance Operations into the consolidated Group framework. Next >