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Risk report

Overriding goals and organisation of our risk management

With a view to conserving capital, we seek to control and manage our specified individual risks in such a way that the total risk remains within the permissible, defined tolerances. Risk management therefore forms an integral component of our value-based enterprise management and hence of all higher-order decision-making processes. In addition to conserving capital, we are careful to allocate our scarce equity resources flexibly to those areas that promise the highest risk-weighted profit. Our insights from the risk management system provide an overview at all times of the Group's current and expected future overall risk situation. These insights thus establish a framework for decision-making on all levels of management by bringing transparency to the relationship between opportunities and risks. Operational realisation of these objectives is ensured inter alia through standard and ad hoc reports tailored to the risks, systematic and comprehensive recording of all material risks and our review – based on a closed loop system – of the efficiency of all relevant systems in risk management. Appropriate rules establish a separation between units that enter into or manage risks, on the one hand, and those that monitor risks, on the other. Process-integrated monitoring is performed by the Risk Committee, the Chief Risk Officer and the supporting organisational units. Process-independent monitoring is the responsibility of Internal Auditing.

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Central elements of the risk management system

Controlling elements Key risk management tasks
Supervisory Board
  • Advising and monitoring the Executive Board in its management of the company, inter alia with respect to risk management
Executive Board
  • Overall responsibility for risk management
  • Definition of the risk strategy
  • Responsible for the proper functioning of risk management
Risk Committee
  • Monitoring and coordinating body with respect to operational risk management
  • Decision-making power is within the bounds of the risk strategy defined by the Executive Board
Chief Risk Officer
  • Responsibility for holistic risk monitoring across departments (systematic identification and assessment, control/monitoring and reporting of risks) of all material assets- and liabilities-side risks from the Group perspective
Group Risk Management (central and decentralised risk monitoring function)
  • Process-integrated risk monitoring function
  • Methodological competence, inter alia for
    • development of processes/methods for risk assessment, management and analysis,
    • risk limitation and reporting,
    • risk monitoring and determination of the required risk capital across the Group
Business units
  • Primary risk responsibility, inter alia responsible for risk identification and assessment on the departmental level
  • The task is performed on the basis of the guidelines set out by Group Risk Management
Internal Auditing
  • Process-independent review of all functional areas of Hannover Re