RISK MANAGEMENT SYSTEM

Overall risk management philosophy of the company:

The Company’s philosophy of risk management has its foundation in the concept that taking material risks is required in order to seek rewards and to fulfill the Company’s multi‐faceted mission. However, these risks should be assessed in order to insure that effective mitigation strategies are employed to the greatest extent possible. Mitigation strategies should consider transferring or insuring risk, reducing the likelihood of the risk occurring, reducing the severity of the risk should it occur, avoiding the risk altogether, or accepting the risk, while continuing to monitor it to ensure it stays within the Company’s risk appetite.

The Risk Management Committee assists the Board of Directors (Board) in fulfilling its responsibility for oversight of the organization’s risk management processes. It reviews and endorses to the Board changes or amendments to the ERM Policy, as well as the adequacy and effectiveness of the Company’s enterprise risk management process. The Risk Management Committee provides a report to the Board on its assessment of the effectiveness of the risk management process and reviews reports from Internal Audit (IA) with regard to the independent validation of compliance with the approved ERM Policy and assessment of current state of ERM framework.

 

Risk Management and Corporate Governance Committee

The Risk Management and Corporate Governance Committee shall be composed of four (4) members of the Board, at least one of whom should be an Independent Director, and shall also be composed of non-voting members which shall include the Company’s Chief Finance Officer, Head of the Risk Management and the Chief Compliance Officer.

The Risk Management and Corporate Governance Committee assists the Board of Directors in fulfilling its responsibility for oversight of the organization’s risk management and corporate compliance and governance processes. It reviews and endorses to the Board changes or amendments to the company’s policies, as well as the adequacy and effectiveness of the Company’s enterprise risk management process. The Risk Management Committee provides a report to the Board on its assessment of the effectiveness of the risk management process and reviews reports from Internal Audit with regard to the independent validation of compliance with the approved Risk Policy and assessment of current state of Risk Management framework.

Specifically, Risk Management and Corporate Governance Committee shall have the following functions:

a.)     exercise oversight of management’s responsibilities, and review the risk profile of the organization to ensure that risk is not higher than the risk appetite determined by the board.

b.)    ensure that the Company is taking appropriate measures to achieve prudent balance between risk and reward in both ongoing and new business activities in compliance as well to the Corporate Governance policies.

c.)     assist the Board in setting risk strategies, policies, frameworks, models and procedures in liaison with management and in the discharge of its duties relating to corporate accountability and associated risk in terms of management assurance and reporting.

d.)    review and assess the quality, integrity and effectiveness of the risk management and compliance systems and ensure that the risk policies and strategies are effectively managed

e.)    provide oversight, identify and assesses significant social, ethical and environmental interdependencies that might impact on the long-term business objective of the Company to be recognized as a responsible and sustainable Corporation in the real еstatе property sector;

f.)     Guide policy-making in the Corporation’s sustainability program, and ensure full Corporation support and alignment with the Company’s subsidiaries and affiliates’ commitment to sustainable development;

g.)    review and recommend the implementation of structures and procedures to facilitate the Board’s independence from management and to avoid conflicts of interest;

h.)    monitor relationships between senior management and the Board, and recommend procedures to allow directors to have access to, and an effective relationship with, senior management;