2022 Full-year results
How Trafigura manages risk
A rigorous and conservative approach to risk management is an integral element and central focus of our business.
Trafigura has developed rigorous risk management and governance systems to address the full range of risks to which it is exposed. These systems apply multiple lines of oversight to ensure compliance with all applicable laws and regulations, and a high standard of ethical behaviour by all employees at all times. The Group actively manages and mitigates, wherever possible, identifiable and foreseeable risks inherent to its activity.
The Board of Directors has principal oversight responsibility, sets the risk management framework, determines the overall risk appetite of the business and ensures that the appropriate structures and processes are in place to manage each category of risk in an appropriate manner. The Management Committee is responsible for the day-to-day management of the Group's operations and investment portfolio, and provides direct oversight of the Board's risk management strategy.
Further lines of oversight consist of the Risk Management, Finance, ESG, HSEC and Compliance committees. The Committees are supported by the Internal Controls Department, which assists management across the Group to continually assess risks and controls for governance, trading, IT and operational processes. Results of these activities are reported to the Audit Committee, accompanied by action plans to strengthen controls and further mitigate risks where required.
Crucially, the company’s Risk Governance relies on a robust organisational setup with an independent Risk Management function, the existence of clearly communicated and well-defined rules and limits, and a culture of continuous exposure monitoring.