Operational risk is the risk of material adverse impact resulting from inadequate internal processes, people or systems or from external events and is inherent in all our businesses. Each of our main operations is managed separately and has its own financial control, operations and IT departments with operational risk management carried out by the local management. Consequently there is little or no integration of systems, management or processes, which mitigates systemic operational risk.

Our Asset Management division has a range of controls to support the quality of its product range and of the investment process, including new product, asset allocation and investment committees, in which its senior central management participates where appropriate, and regular reviews of investment performance. These are backed up by rigorous controls to safeguard clients’ stock and money.

The principal operational risks to which our Corporate Finance division is exposed are controlled and monitored by its Risk Committee in which senior management of both Corporate Finance and group participate.